The Australian Bureau of Statistics (ABS) released June 2015 quarter data on construction work done earlier this week.
The data showed that over the quarter there was $49.8 billion worth of construction work completed.
This figure was comprised of $23.3 billion worth of building work and $26.5 billion worth of engineering work.
Over the quarter, building work fell -2.6% however, it was 3.8% higher year-on-year.
Engineering work rose 5.6% over the quarter but was -8.8% lower year-on-year.
Building work is comprised of residential and non-residential construction which accounted for $14.6 billion and $8.7 billion worth of building activity respectively over the quarter.
Throughout the June 2015 quarter, the value of residential work fell -3.0% and non-residential fell -1.8%.
Year-on-year residential work has increased by 7.4% compared to a -1.8% fall in non-residential work.
It is difficult to know whether residential building has peaked however, building approvals data suggests it may have.
Given that engineering construction also appears set to fall, we would expect further weakness in these figures over the coming quarters.
Earlier this week the Australian Prudential Regulation Authority (APRA) released its June 2015 quarterly data on property exposures by Australian Authorised Deposit-taking Institutions (ADIs).
Essentially this data release highlights the level of exposure our lenders have to property with a significant focus on residential property.
The data showed that Australian ADIs had just over $1.3 trillion worth of outstanding residential term loans.
Over the past year, this figure grew by 7.9% with owner occupier lending rising 2.0% compared to an 18.6% rise in investment lending.
Over the quarter there was a 17.8% rise in new residential lending with a 3.6% rise in lending to owner occupiers compared to a 26.4% rise in lending to investors.
The data also shows that lending to borrowers with small deposits as a proportion of all lending is slowing.
Of the $96 billion lent over the quarter, only 10.7% was lent to borrowers with a loan to value ratio (LVR) of greater than 90%.
That represents the lowest proportion of lending to this cohort since the December 2010 quarter.
Lending to investors remains above APRA’s 10% pa threshold however, most of the changes by lenders were made during this quarter.
As a result this data may mark a peak in lending to investors and certain borrowers can expect challenges when applying for new investment mortgages.
Over the week ending August 23, CoreLogic RP Data captured 2,027 auction results, accounting for just over 90% of all auctions held across the capital cities.
The final auction clearance rate over the past week was recorded at 72.9%, down from 74.6% over the preceding week, but higher than one year ago when 69.5% of auctions across the combined capitals were sold.
Both Melbourne and Sydney, Australia’s two largest auction markets saw clearance rates fall last week.
Melbourne’s clearance rate was 74.3% across 906 results, down from 76.5% the previous week, while Sydney’s clearance rate was down from 77.3% the previous week to 76.2% last week.
There were 930 auctions held across the Sydney last week, with 812 results captured.
The national number of newly advertised properties increased by 4.0% relative to the same period one year ago to reach 41,092 properties added to the listings pool over the past twenty eight days.
The increase in new listing numbers was fuelled by the capital cities where newly advertised homes were 7.0% higher than a year ago.
The largest increases in new listing numbers are coming from Sydney (+16.6%), Melbourne (+11.5%) and Canberra (+19.4%) while vendors are adding fewer new listings to the market compared with last year in Darwin (-21.9%), Hobart (-12.1%) and Perth (-10.8%).
Total stock levels are now roughly similar to levels a year ago (-1.6%) nationally and slightly higher (+0.3%) across the capital cities.
The strongest housing markets are still seeing listing numbers lower than a year ago, although this trend might not last for much longer.
Stock levels in Sydney are only -1.5% lower than a year ago and -6.5% lower than a year ago in Melbourne.
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