Australia's construction industry continues to blossom, with home building leading the charge.
The Australian Industry Group/Housing Industry Association Performance of Construction Index rose to 55 points in August.
It was the third straight month the index has remained above the 50 level that separates expansion from contraction.
The industry continues to rebalance, adjusting to the decline in engineering construction, due to the mining investment slowdown and a lack of government-initiated major projects, the report said.
But residential and commercial construction have stepped in to fill the breach.
News that makes sense
Your trusted source for staying up-to-date with the world around you. Get free daily news updates and analysis, straight to your inbox.
Apartment building was the strongest performer in August, followed by commercial construction and house building.
"The construction industry is continuing to rebalance away from the large projects that have lifted mining and minerals export capacity and towards the residential and commercial construction sub-sectors," Ai Group director of public policy Peter Burn said.
"The combination of low interest rates and strong gains in asset values is underwriting continued strength of apartment and house building.
"The near-term outlook is for continued growth and, with further contraction of engineering construction expected, ongoing rebalancing within the overall construction sector."
Housing Industry Association economist Diwa Hopkins said the construction pickup had flowed through to increased employment.
"The labour-intensive nature of construction means that growth in this sector and the associated job creation can make a significant contribution to improving broader labour market outcomes," Ms Hopkins said.
