Dwelling Approvals Down, Yet Also Up?

04/02/2016 4:30 am

housing-supply

The Australian Bureau of Statistics (ABS)  has reported that Building Approvals show that the number of dwellings approved fell 0.1 per cent in December 2015, in trend terms, and has fallen for eight consecutive months. However, CoreLogic's Cameron Kusher  highlighted that Following a -12.4% monthly fall in dwelling approvals in November, approvals rose by 9.2% to 18,868 approvals in December 2015.

The ABS released building approvals data for December 2015 earlier today. Dwelling approvals decreased in December in the Australian Capital Territory (21.9 per cent), Western Australia (3.1 per cent), Tasmania (0.8 per cent), New South Wales (0.4 per cent) and South Australia (0.4 per cent) but increased in the Northern Territory (1.8 per cent), Victoria (1.6 per cent) and Queensland (1.1 per cent) in trend terms.

Cameron Kusher writes in the CoreLogic RP Data Research Blog

The 18,868 dwelling approvals in December 2015 consisted of 9,968 house approvals and 8,899 unit approvals. Both house and unit approvals recorded a large jump in December, up 5.7% and 13.5% respectively. Year-on-year, house approvals are 3.4% higher while unit approvals are -8.3% lower resulting in a -2.5% fall in total dwelling approvals. Despite the year-on-year fall in approvals they remain at close to record high levels although they are -8.7% lower than their recent record high recorded in June 2015

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From a developer’s perspective the returns are much higher building to high-densities than there are constructing medium density properties such as townhouses.

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