A jump in multi-residential unit approvals has seen the number of houses and apartments approved for construction rise, but overall building approval levels remain well down on recent historic levels, the latest data from the Australian Bureau of Statistics indicates.
On a seasonally adjusted basis, a total of 12,046 dwelling units were approved in August, up 6.4% compared with the previous month in July.
That monthly rise, however, is largely a reflection of low numbers in July, when approvals plummeted to their second lowest level so far this year after multi-residential sales plummeted following the end of home buyer schemes in New South Wales and Victoria.
Indeed, take out a rebound of nearly one quarter in the volatile multi-unit sector (off a very low base in July) and the more stable private sector stand-alone housing segment of the market contracted by 0.5% last month.
Moreover, even with the jump in multi-residential units, overall approval levels (down 15.4% compared with the same period last year) are still low in recent historic terms (see chart).
Not surprisingly then, Housing Industry Association Chief Economist Harley Dale says the latest numbers, which follow figures on Wednesday showing new home sales at 15 year lows, are not encouraging.
Whilst he expects a modest near term improvement on the back of lower interest rates,stimulus measures in New South Wales and Queensland and a reduction in the bottleneck in Western Australia, Dale says the prospect of a third yearly consecutive yearly decline in housing starts is coming into play.
On a state-by state basis, Victoria (up 30.2%) and Western Australia led the way (though Victoria was coming off an extremely low basis) with Queensland also registering a 1.8% rise.
By contrast, New South Wales, South Australia and Tasmania registered falls of 18.3%, 1.0% and 0.9% respectively.
Taking out the volatile multi-residential sector, private sector house approvals fell in New South Wales (-10.4%) and Queensland (-3.6%) but rose in Western Australia (11.0%), South Australia (1.4%) and Victoria (0.8%).