This article is from the Australian Property Journal archive
HOUSING approvals have risen to their highest level since February 2000, underpinned by the federal government’s HomeBuilder grant, which was recently extended to March next year.
According to the Australia Bureau of Statistics, private sector houses approval rose for the fourth consecutive month in October, by 3.1% or 10,692 dwellings and is 31.7% higher than a year ago.
Total dwelling approvals increased 3.8% or 16,584 and is 14.3% higher year-on-year. The HomeBuilder grant has also benefitted high rise apartments with approvals rising 6.2% or 5,529 dwellings but it is 10.6% lower y-o-y.
ABS director of construction statistics Daniel Rossi said the continued strong demand for detached housing follows the relaxation of COVID-19 restrictions in most states and territories.
“Record low interest rates and a range of federal and state-based incentives are also providing support for the housing sector,” he added.
Archistar chief economist Dr Andrew Wilson said demand is clearly driven by the HomeBuilder grant.
“The federal government recently announced that the HomeBuilder program will be extended to March 2021 and the property price cap for eligible builds will be raised from $750,000 to $850,000 in Victoria and $950,000 in NSW. The value of the grants however will be cut from $25,000 to $15,000.
“This is good news for a booming new house sector and a strongly reviving economy.” Wilson said.
Master Builders Australia chief economist Shane Garrett said the numbers provide further proof that the HomeBuilder scheme is a huge success in supporting new home building at a very challenging time.
“Inward migration to Australia is the single biggest driver of demand for new home building and with permanent arrivals to the country at their lowest since World War II, government support for residential building has prevented activity from sinking to catastrophic levels,” he said.
The rise in total dwelling approvals was driven by large increases in New South Wales (32.1%) and Western Australia (29.7%). Falls were recorded in Victoria (15.0%), Tasmania (3.4%), South Australia (2.4%) and Queensland (0.8%).
Approvals for private sector houses rose in Western Australia (37.5%), Queensland (9.4%) and South Australia (5.0%). Meanwhile, falls were recorded in Victoria (6.9%) and New South Wales (4.2%).
The value of total buildings approved rose 26.1% in October, in seasonally adjusted terms.
The value of non-residential building rose 58.6%. This rise was driven by a series of large projects in the public sector, following a weak result in September.
The value of total residential building increased 9.4%, comprising a 11.5% rise in new residential building, and a 3.3% decline in alterations and additions.
