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The Australian Bureau of Statistics today released its monthly building approvals data for March for detached houses and multi-units covering all states and territories.
“Detached house approvals declined by 2.9 per cent in the month of March to be 15.0 per cent lower than in the same month last year,” added Mr Devitt.
“This continues the long-lagged response of Australian homebuyers to the RBA’s interest rate hiking cycle, with further declines expected in the coming months.
“The adverse impact of last year’s cash rate increases is still to fully flow through to the official data. Further cash rate increases this year will have only added further weight to these declines.
“Multi-unit approvals in 2023 have recorded their lowest levels since 2012. The combination of construction cost blowouts, labour uncertainties, increased compliance costs and taxes on investors has seen approvals for multi-units stall.
“These disappointing approvals numbers are occurring as population growth surges with the return of overseas migrants, students and tourists.
“This imbalance will see the affordability and rental crisis deteriorate further,” concluded Mr Devitt.
Total building approvals were down across almost all the jurisdictions in the March Quarter 2023 compared to the same quarter last year. In seasonally adjusted terms, decreases were led by New South Wales (-34.1 per cent) and Victoria (-26.6 per cent), followed by Western Australia (-14.9 per cent), Tasmania (-10.8 per cent) and South Australia (-5.7 per cent), while Queensland increased by 8.6 per cent. In original terms the Australian Capital Territory saw a decline of 35.3 per cent and Northern Territory was down by 19.1 per cent.
“The long-discussed move of the University of Tasmania (UTAS) from the Sandy Bay campus presents a real opportunity to ease housing pressures in Greater Hobart,” said Stuart Collins, HIA Executive Director Tasmania.
The Victorian Government has announced it is proposing Regulations that will require building practitioners and plumbers to meet Continuing Professional Development (CPD) requirements. A Regulatory Impact Statement and proposed regulations has been released for public comment.
HIA commented on the Explanation of Intended Effect (EIE) which outlines proposed changes to encourage more low-rise and mid-rise housing (December 2023).
“Australia is set to commence construction on little more than a million new homes over the next five years, almost 200,000 short of the Australian government’s target,” stated HIA Senior Economist Tom Devitt.