Dwelling approvals on the up again
Despite ongoing fears of oversupply in Melbourne, Brisbane and even Sydney, it seems approvals for multi-unit dwellings are on the climb again.
The total number of all dwellings approved rose 1.2 per cent in April 2016, in trend terms, and has risen for five months, according to data released by the Australian Bureau of Statistics (ABS).
Dwelling approvals increased in April in the Australian Capital Territory (6.7 per cent), Queensland (2.9 per cent), South Australia (2.2 per cent), Tasmania (1.9 per cent) and New South Wales (1.4 per cent), though they decreased in the Northern Territory (15.2 per cent) and Western Australia (0.1 per cent) in trend terms, and were flat in Victoria.
“Approvals for multi-unit dwellings provided the impetus for the headline growth in April, with approvals in this part of the market growing by 8.1 per cent during the month,” Housing Industry Association economist Geordan Murray says.
“The growth in multi-unit approvals was driven by the eastern seaboard states, where we saw multi-unit approvals jump by 20 per cent in Queensland, 19 per cent in NSW, and 7 per cent in Victoria. South Australia also posted an increase of 3 per cent.
“In contrast to the situation with multi-unit approvals, the number of detached house approvals fell across the eastern seaboard states, while all other states and territories posted improvements,” he adds.
“It’s pleasing to see the likes of South Australia post the strongest month of detached house approvals in more than two years.”
Urban Taskforce CEO Chris Johnson says the approval numbers for April indicate that apartments are still booming in NSW.
“The jump in approvals is in contrast to Victoria, where on a trend basis apartment approvals dropped to 2538 in April, indicating a cooling of the Victorian market,” he says.
“This is reinforced by aggressive marketing of Melbourne apartments into the Sydney market.
“House approvals in Victoria are still very strong, with 3128 in April compared to 2263 house approvals in NSW.”
While monitoring housing approvals is useful to assess trends, Johnson points out that not all approvals lead to completions of real homes.
“It would seem in NSW that there’s a significant gap between approvals and completions due to the staging of large projects and to excessive conditions to approvals that can make projects unviable,” he says.
“With a shortfall of almost 6000 new homes last financial year compared to government projections, it’s vital that the supply of new houses and of new apartments continues at a strong level in Sydney.”
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