Home building numbers in Australia easing, latest data shows

Residential building approvals slipped back for the third consecutive month in April after reaching a decade high in January, according to the latest figures from the Australian Bureau of Statistics.

The data shows that total seasonally adjusted building approvals fell by 5.6%. Detached house approvals were effectively flat in the month with a fall of 0.1% but remained at a level that is 16.1% higher than April a year ago.

Approvals for other dwellings fell by 13.5% month on month and were down by 17% compared to the level a year earlier.
 
Seasonally adjusted building approvals increased by 14.8% in Victoria, by 12.2% in South Australia, and by 4.4% in Western Australia. They fell by 22.8% in New South Wales, by 20.3% in Queensland and by 10.4% in Tasmania. In trend terms, building approvals declined by 12% in the Northern Territory and fell by 5.8% in the ACT.

However, the quantum of approvals remains strong, according to the Housing Industry Association, the voice of Australia’s residential building industry.

‘The monthly volume of building approvals in April 2014, continued to recede from the decade high achieved back in January, although with close to 15,000 dwellings approved in the month it is still a very positive result,’ said HIA economist Geordan Murray.

‘The pace of building approvals late in 2013 and early 2014 moved well ahead of the pace of home building commencements. So while we have seen building approval activity moderate over recent months, the pipeline of residential building work already approved should sustain a historically high level of activity throughout the middle part of the 2014,’ he explained.

‘While declining numbers of multi-unit approvals have been behind the recent decline, they still represent a historically large share of multi-unit dwellings in the pipeline. The longer build time associated with the larger multi-unit development projects means that work already approved could well sustain activity for some time to come,’ he added.