The latest building approvals data, released by the Australian Bureau of Statistics on Thursday, confirms that the housing market is very much a Sydney and Melbourne story.
“Building approvals fell by 6.3 per cent in NSW, underwriting a fall in total dwelling units approved of 1.2 per cent over December 2016.
Meanwhile, Victoria has sustained a small rebound in total building approvals of 1.5 per cent, which has extended for two months.
Together, NSW and Victoria accounted for over 65 percent of new residential building approvals in December 2016,”, Master Builders Australia National Manager for Housing Matthew Pollock said.
“Nationally, apartment approvals continue to show positive growth and paints an optimistic outlook for apartment building activity in 2017, up by 0.9 per cent over December 2016,” he said.
“The value of alterations and additions also received a welcome boost, up by 15 per cent over the month. However, other segments of the market are softer as the residential building cycle reaches a peak.
Detached housing approvals have fallen for over six straight months, losing another 1.6 per cent in December 2016,” Pollock said.
“It is important that new home building supply is kept up in 2017, in order to help meet growing demand and ensure that supply constraints do not continue to contribute to the growing housing affordability challenge,” he said.
“Non-residential building approvals fell over the month, by approximately 7 per cent. These latest results highlight the need for the Government, in the forthcoming May Budget, ramp up its efforts to address the structural Budget deficit, to restore confidence and investment in the building and construction industry and the wider economy.
“Overall, Master Builder expects a softer period ahead, with the latest ABS building approvals data shows a continuing downward trend, but the pipeline of work should sustain activity in 2017, with a moderation expected to follow in 2018,” he said.