The latest building approvals data from the ABS confirms that the Australian property market is very much focused in Sydney and Melbourne.
“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,” Matthew Pollock, Master Builders Australia’s national manager – housing, said.
“Together, NSW and Victoria accounted for over 65 per cent of new residential building approvals in December 2016,” Mr Pollock said.
Apartment approvals grew nationally, which Mr Pollock believes shows a positive outlook for building activity in 2017. Nationally, there was an increase in approvals by 0.9 per cent over December.
“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,” Mr 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.”
Mr Pollock urged the government to review the structural deficit in the May budget, as non-residential building approvals fell over the month by approximately 7 per cent.