New home building approvals across Australia increased in May, adding to evidence that Australia’s housing market is in the early stages of a recovery.
Australian Bureau of Statistics (ABS) data for May shows a 2.1 per cent rise in the number of approvals for new apartments during the month. According to Master Builders Australia chief economist Shane Garrett, this is the portion or the market worst hit by the downturn, which began in 2017.
“House price figures released earlier this week also support the view that we are at a turning point in the housing market. The latest rate cut from the RBA will help further in this regard. The quick passage of the tax cuts currently before Parliament would represent a big step forward,” Garrett says.
“In contrast to the residential side of the market, commercial building approvals dropped 6.7 per cent during May,” he adds.
“The disappointing figures for commercial building again underline the importance of delivering government-led projects more quickly in order to support the many small building firms who are dependent on such work. A speedier roll out would do much to enhance confidence,” Garrett says.
During May, Victoria saw the largest increase in new dwelling approvals (+14.4%), followed by the ACT (+7.2%).
The volume of approvals in New South Wales was unchanged during the month. The largest reduction in new homes approved affected Queensland (-6.3%), followed by the Northern Territory (-6.1%) and Western Australia (-4.7%). South Australia (-2.9%) and Tasmania (-1.2%) saw more measured reductions.
Compared with a year ago, the value of commercial building approvals in the 3 months to May 2019 grew strongest in New South Wales (+23.7%), followed by Queensland (+14.8%) and Victoria (+1.9%). The largest reductions occurred in Tasmania (-47.3%) and the Northern Territory (-34.4%). Commercial building approvals have also fallen back in South Australia (-10.0%), the ACT (-5.6%) and Western Australia (-4.2%).
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