Australia home building slips

Photo credit: 8LettersUK

Figures from ABS show that approvals fell for the third month in a row in April 2014.

Total building approvals dipped 5.6 per cent to 14,931 (seasonally adjusted). Detached house approvals were effectively flat in the month (-0.1 per cent) but remained at a level that is 16.1 per cent higher than April a year ago. Approvals for ‘other dwellings’ fell by 13.5 per cent in the month and
were down by 17.0 per cent compared to the level a year earlier.

The Housing Industry Association notes that the quantum of approvals "remains strong", though.

"With close to 15,000 dwellings approved in the month it is still a very positive result,” says HIA Economist, Geordan Murray.

“The pace of building approvals late in 2013 and early 2014 moved well ahead of the pace of homebuilding commencements. So while we have seen building approval activity moderate over recent months, the pipeline of residential building work already approved should sustain a historically high level of activity throughout the middle part of the 2014."

Indeed, while declining numbers of multi-unit approvals have been behind the recent decline, they still represent a historically large share of multi-unit dwellings in the pipeline, Murray notes.

"The longer build time associated with the larger multi-unit development projects means that work already approved could well sustain activity for some time to come."