House Building Skyrocketing but Units Still Plunging

House building activity continues to soar off the back of the now-defunct federal government HomeBuilder initiative.

Latest ABS data reports that capital city building approvals for houses increased by 36.4% over February to a new record monthly high of 8,697.

Over the first two months of this year, approvals for new houses have skyrocketed by 36.1% compared to the same period last year.

All capitals have reported sharp increases in house building approvals over the past year with Perth the standout up by a remarkable 121.0% in the current year to date comparisons.

Perth recorded 1,970 house building approvals over February which was second only Melbourne with 2,675 and well ahead of next placed Brisbane with 1,406 house building approvals.

1 Building Approvals

2 Building Approvals

Although house building is surging courtesy of the HomeBuilder policy, building approvals for units continue to plunge.

Capital city unit approvals have fallen by 29.0% over this year so far compared to the same period last year with the total home building market share now at just 32.2% – the lowest result since October 2009.

3 Monthly Capital City Annual Bilding Approvals

Surging capital city house building approvals have predictably lifted total residential building levels over recent months however levels remain well below the peak results recorded in 2016.

4 Monthly Capital City Annual Bilding Approvals

Despite recent strong house building activity, the adequacy of underlying capital city housing supply remains questionable with action clearly required to reinvigorate the moribund unit sector.

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About

Dr Andrew Wilson, Chief Economist of www.MyHousingMarket.com.au is widely regarded as Australia’s leading property economist.


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