ANZ says that the overall increase in housing approvals in January thwarted market expectations of another decline.
According to the latest Quick Reaction by ANZ, the total number of housing approvals increased by 1.8 per cent month-on-month in January, after falling 2.5 per cent in December 2016.
“Building approvals posted a modest increase in January, beating expectations of another small decline,” ANZ said.
Similarly, apartment approvals grew solidly in January by 6.6 per cent month-on-month across the country.
ANZ pointed out that the strength in the apartment sector was driven “almost entirely” by NSW, which posted an increase of 53 per cent.
Victoria’s unit approvals fell only slightly during the month and are starting to stabilise, but remain at “surprisingly” elevated levels.
On the other hand, Queensland’s unit approvals in January fell to their lowest monthly level since April 2014.
Meanwhile, detached housing approvals fell for the fourth month in a row, however, were offset by a rise in unit approvals (although these results were mixed across the states).
“[Detached] house approvals in January were the lowest since October 2013, and now sit 9 per cent lower than a year ago. The fact that building approvals and construction of houses has barely moved for two decades largely reflects changing preferences and demographics such as our ageing population.
“But the recent decline in house approvals perhaps also reflects the relative unaffordability of houses and land, given persistently strong price growth.”