Healthy building approvals, but cycle may have peaked: HIA
The Australian Bureau of Statistics’ residential building approvals are suggestive of a healthy 2014, according to the Housing Industry Association’s chief economist Harley Dale.
Noting that the March 2014 approvals have seen healthy growth, Dale noted that the approvals cycle itself may well have peaked.
“New home building has a large reach into the wider domestic economy and the sector is very much Australia's economic barometer in 2014,” he said.
“If you're searching for highlights to the Australian economy, new housing is the best shot you can take,” he continued.
“Leading indicators such as building approvals are clearly a positive for the economic outlook. How many of these approvals are converted into dwelling commencements and over what timeframe will exert a considerable influence over wider domestic economic activity.”
Over March, the total seasonally adjusted building approvals actually fell 3.5% to 15,598, the second consecutive monthly decline, while detached house approvals remained flat, down 0.5%. Over the March quarter, detached housing approvals grew 7.7%.
The approvals for ‘other dwellings’ fell by 7.5% over the month, down 7.2% over the quarter.
“The momentum in approvals has slowly shifted from multi-units to detached houses and that is evident in the March quarter results,” he said.
This comes after multi-unit dwelling approvals hit a record high in last year’s December quarter.
Seasonally adjusted, approval increases were seen in New South Wales (8%) and Tasmania (33.1%). Approvals were flat in South Australia. They fell in Victoria (12.5%), Queensland (3.3%) and Western Australia (9.1%). The Northern Territory saw a 25% decline in trend terms, with the ACT increasing 0.7%.
New South Wales Minister for Planning, Pru Goward, was jubilant over the state’s result.
“Over the 12 months to March 2014 nearly 51,000 new homes were approved in NSW, the highest in almost eleven years,” said Goward.
“Today’s figures also show more than 4,700 new homes were approved in March this year, compared to just less than 3,100 last March,” she said.
