This article is from the Australian Property Journal archive
DWELLING approvals fell -4.7% in August after rising in the previous month, according to the Australian Bureau of Statistics.
The fall was due to continued weakness in private sector houses approvals which fell 4.3% for the third month in a row. This offset the minor 1.4% increase in private sector other dwellings (apartments and townhouses) approvals.
Although the apartment sector has recorded growth for three consecutive months, the August increase is the smallest.
The value of total building approved fell -4.2% in August in seasonally adjusted terms. The value of total residential building fell by -7.8% whilst non-residential building rose by 3.1%.
According to the ABS, Queensland (0.9%), South Australia (11.2%) and Western Australia (0.9%) recorded more dwelling approvals this month, whilst New South Wales (-16.0%), Victoria (-1.4%) and Tasmania (-10.5%) recorded less dwelling approvals in seasonally adjusted terms.
Private sector houses approved fell -4.3% due to falls in New South Wales (-7.5%), Victoria (-7.7%), Queensland (-7.0%) while South Australia (3.6%) and Western Australia (12.3%) rose.
Master Builders director of housing policy Paul Bidwell said this grim picture highlights the severe impact that the ‘quick fire’ rise in interest rates earlier this year has had on demand.
He added that the approvals also reinforce why the Reserve Bank of Australia needs to be extremely cautious when making its decision on interest rates next week.
“An interest rate rise next week would be a major blow to the building and construction industry, which is one of the state’s largest employers and key contributors to both GDP and GSP (Gross State Product).
“The housing finance figures for July provided a glimmer of hope, but we don’t expect to see those figures reflected in the building approval data for another couple of months yet,”
“We are holding our breath for the August finance approvals, which will be released on 11 October, to see if there’s any change in the wind,” he concluded.
Australian Property Journal
