New home approvals recover in Australia after slow start to the year
New home approvals in Australia recovered in February after a decline in the first month of 2016, according to the latest data to be released.
Home building approvals increased by 3.1% during February after beginning the year on a much slower note, says the new report from the Housing Industry Association (HIA).
But there was a 1% fall in detached house approvals while the more volatile multi-unit segment achieved growth of 7.7% and over the year to February, new dwelling approvals totalled 232,194.
According to HIA senior economist Shane Garrett the flow of data over recent months indicates that approvals may have hit their high point in the year to October 2015, with a record 239,250 approvals registered over that 12 month period.
‘The monthly lift in approvals activity during February is welcome but it seems increasingly likely that approvals peaked late last year and that the volume of new home building activity is set to ease as 2016 progresses,’ he said.
‘Our latest forecasts indicate that the about 200,000 new dwelling starts will take place during 2016, a reduction of 9.2%from last year. This would still represent a very high level of output by historic standards,’ he explained.
‘However, the risk remains that new home building output will fall below the levels required to meet long term demand. The onus remains on policy makers to tackle this problem, and confront issues like planning delays, land supply shortfalls and heavily inefficient taxes like conveyance stamp duty,’ he added.
A breakdown of the figures shows that total seasonally adjusted new home building approvals saw the largest increase in Tasmania with growth of 24.5%, up 14.3% in New South Wales and up 9.5% in Queensland.
Approvals declined in Victoria by 12.8%, in South Australia by 10.9% and in Western Australia by 7.6%. In trend terms, approvals saw a 9.2% fall in the Northern Territory but rose by 5% in the Australian Capital Territory.