Apartment approvals nosedive by nearly 30%

The number of apartments approved for building has plunged by 29.5 per cent since July last year, the Australian Bureau of Statistics has reported.

The latest ABS building approvals reveal that 8,080 private sector dwellings (excluding houses) were approved in July. According to the seasonally adjusted figures, apartment approvals fell by 6.7 per cent between June and July.

A total 18,299 dwellings were approved in July, down by 1.7 per cent from June and down by 13.9 per cent since July 2016.

The number of private sector house approvals grew by 2.3 per cent on the July 2016 figures to 9,743, but no change was recorded on the June 2017 figure.

“[These] building approval figures show that the detached house building sector has plateaued at a high level while the building of multi-unit projects is sliding,” Tim Reardon, the principal economist at the Housing Industry Association, said.

“The significant variation in industry conditions between the multi-unit sector and detached homes and around the states is likely to continue for some time consistent with HIA’s latest forecasts,” Mr Reardon concluded.

Looking at the figures for construction work done in the June quarter, also released this week, Mr Reardon said: “The slowdown in the multi-unit sector is also showing up in the amount of work done on all residential sites [which] has fallen by 3.2 per cent in the first half of this year. This slowdown in on-site activity is likely to see residential building have a negative impact on GDP growth for the June quarter.”

According to the ABS seasonally adjusted figures for construction work done in the June 2017 quarter, the value of residential work done fell by 3.5 per cent on the June 2016 quarter.

The total value of residential construction done in the June 2017 quarter came at $17.5 billion, reflecting a fall of 0.4 per cent on the March 2017 quarter.

[Related: Investor lending bounces back in June]

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Lucy Dean

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