Competition in construction is forcing builders to scrape by with low margins.  

Corelogic's Construction Cost Index shows building costs have dropped 1.1% in the three months to June, the first decrease in 12 years.  

It looks at the price of labour, material, plant hire, and subcontract services. 

Construction Industry Council Executive Director Tommy Honey told Andrew Dickens it's pushing subcontractors to tighten their belts.  

He says it's good news for those wanting to build but foreboding for the construction sector. 

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