‘Building approvals for both detached houses and other dwellings saw increases in November 2011, although the results come off a low base and total approvals remain significantly down on a year earlier,’ said HIA senior economist, Andrew Harvey.
In the month of November 2011 total seasonally adjusted building approvals rose by 8.4% following a 10% drop in October and a 14.8% fall in September. Detached house approvals rose by 4.9% in November while approvals for other dwellings rose by 16.1%. Total November approvals were down by 18.9% on one year earlier.
‘At least today’s approvals update is on the right side of zero growth, but the level of total approvals remains weak and serves to reinforce the need for further interest rate cuts in the first half of 2012,’ added Harvey.
He said that further rate cuts are absolutely essential to shore up home buyer confidence in light of global economic conditions and to help ameliorate the effects of the increased consumer cautiousness that has pervaded the Australian economy.
‘Building approvals over the three months to November 2011 imply an annual level of housing starts of under 130,000. That is lower than the level reached in 2008/09 and strengthens the case for urgent government action in addition to further rate cuts,’ he explained.
The November results were mixed across the states and territories but Victoria was the standout with seasonally adjusted approvals up by 39.9% in the month, a result exaggerated by the poor showing in October.
Seasonally adjusted approvals rose by 2% in New South Wales and by 6.6% in Queensland. Approvals fell by 1.9% in South Australia, by 16.9% in Western Australia and by 7.9% in Tasmania. In trend terms, approvals fell by 14% in the Northern Territory and by 21.5% in the Australian Capital Territory.
Other figures show that house prices posted their first monthly rise in a year during November, buoyed by the first interest rate cut since early 2009, according to the RP Data-Rismark capital city home value index.
Capital city home values were up 0.1% in November, the first increase since December 2010, while regional house values also increased the most since December 2010, rising by 0.3%.
Rismark director Christopher Joye said the figures were an optimistic reflection of the sector's potential in 2012. ‘This was the single best monthly result since December 2010. It augurs well for housing activity during the first quarter of 2012, which we project will rebound solidly,’ he explained.
Canberra reporting the best values across the year while the data showed flat to positive gains in Sydney, Melbourne, Perth and Canberra for the month of November. Darwin and Brisbane were the worst performers in November. Year on year, Brisbane led the decline in value, followed by Melbourne then Adelaide.
There are more buyers from overseas, according to Colliers International. Chinese buyers spent $106.8 million on Queensland property alone, an increase of 50% on 2010.
Colliers International Gold Coast research manager Lynda Campbell said about half of the spending on Queensland residential property by overseas buyers was on the Gold Coast, which accounted for $165.3 million in 310 transactions.
Brisbane was the second most popular area. It recorded a $4.5 million increase from the previous year with $86.2 million spent across 180 residential sales. Golf course estates are also popular.
