Units lead 8.4% jump in building approvals in November: ABS

Building approvals rose 8.4% in November on a seasonally adjusted basis, following a fall of 10% in the previous month, according to the latest ABS figures.

Despite the strong turnaround in November, approvals remain almost 19% below the level reached a year earlier.

In total 11,424 dwelling were approved for construction in November on a seasonally adjusted basis, with the number of houses approved for construction rising 4.8% to 7,469 while the more volatile units sector increased by 17.2% to 3,762 dwellings.

Westpac called the November result “better than expected, though still only a partial, rebound in November”.

“The November partial rebound … still leaves a strong trend decline in place, but the picture is considerably better than that in October. 

“That detail shows solid rebounds in key areas that were of concern last month, including: private sector houses, +4.8%, retracing two thirds of the previous month's decline; and Victoria up a staggering 40% for the month basically reversing all of the slump over the previous two months. 

“The bounce in Queensland though was less pronounced with a 6.6% monthly rise only recouping a little of the 30% slump over the previous two months. 

“WA also saw a sharp 16.9% drop although this looks unlikely to mark the start of renewed weakness with the state recording accelerating mining-led growth a turnaround in population growth and tightening housing supply. 

“NSW posted a 1.9% monthly rise but had been much more resilient in previous months,” Westpac says.

Earlier this week, the HIA reported a 6.8% increase in new home sales following the November rate cut, but both it and Master Builders Australia say the 2012 outlook is poor and are urging further rate cuts and government stimulus measures to help residential construction.