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{{propApi.successMessage}} {{region}} Change locationBuilding approvals still carrying the momentum of last year
Building approvals still carrying the momentum of last year
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The Australian Bureau of Statistics today released its monthly building approvals data for August 2026 for detached houses and multi-units covering all states and territories.
“House approvals over the last three months sat 14.6 per cent higher than the same quarter last year, reflecting the market’s momentum heading into this year,” added Mr Devitt.
“There are long lags in home building and it is still too soon to see the impact of this year’s speed bumps on building approvals data.
“The impact of rising interest rates, surging fuel costs and government tax increases has reached a number of leading indicators.
“New home sales declined for the fourth consecutive month in August, sitting almost 20 per cent down on a quarterly basis.
“Fewer people are visiting display villages and those who do are proving harder for builders to convert into actual contracts for new home builds.
“Price declines in the established market have continued and broadened, while the costs of land, construction, and taxes and regulations on new builds continue to increase. This undermines the viability of new builds.
“Much of the home building industry had a healthy pipeline of construction work underway heading into this year’s difficulties, as well as a number of projects sold and awaiting commencement. This should sustain activity for the rest of the year.
“We are unlikely to see the impact of recent events on approvals and on-the-ground commencements until next year and beyond, when Australia will build fewer homes than previously expected.
“This is occurring while underlying demand for housing – population growth, shrinking household sizes, replacement of old stock and addressing pre-existing shortages – continues to grow.
“Once these fundamentals reassert themselves, prices will recover and any short term improvements in affordability will be undone.
“This week’s rate hike from the RBA brings the cash rate to its highest level since 2011. This reinforces the need for governments and other policymakers to reduce the costs of land and housing in other ways if Australia is to meet its housing needs.
“This means reducing taxes and restrictions on builders, investors and aspiring homeowners.
“Land and infrastructure need to be brought to market faster and fairly funded rather than increasingly imposed on builders and buyers.
“Australia’s governments – all tiers – have many levers that can be pulled to improve housing affordability in both the short and long term,” concluded Mr Devitt.
In seasonally adjusted terms, Western Australia saw the largest increase in house building approvals in the three months to August compared to the same period a year earlier, to be 21.9 per cent higher. This was followed by South Australia (+17.5 per cent), New South Wales (+17.2 per cent), Queensland (+12.8 per cent) and Victoria (+9.2 per cent). In original terms, Tasmania saw a 22.1 per cent increase, followed by the Australian Capital Territory (+9.2 per cent) and the Northern Territory (+6.0 per cent).
Monthly Building Approvals - Australia
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