The Australian Bureau of Statistics (ABS) has released its monthly building approvals data covering all states and territories.
“Building approvals in the 2019 calendar were 18.5 per cent lower compared to 2018, which has been a significant drag on the national economy,” says HIA economist, Angela Lillicrap.
“The start of 2019 was tough for the residential building industry with the credit squeeze, falling house prices and uncertainty surrounding the federal election putting a dampener on confidence,” says Lillicrap.
“The market did improve in the final months of 2019, suggesting that the building industry will not continue to constrain economic growth in 2020. New home building has stabilised at relatively strong levels.”
“Continued growth in house prices will assist in bringing investors back to the market as well as support an increase in activity across the broader economy. We are unlikely to see the same boom of investors as experienced in the previous cycle due to restrictions on foreign investors.”
“Constraints on access to credit will continue to be the biggest impediment to future growth in building approvals,” she says.
In seasonally adjusted terms, building approvals for the December 2019 quarter increased in Victoria (+26.7 percent), South Australia (+6.9 percent) and New South Wales (+1.2 percent), while declining in Tasmania (-0.8 percent), Queensland (-5.1 percent) and Western Australia (-6.8 percent).
In trend terms, the Australian Capital Territory declined by 0.5 percent while the Northern Territory increased by 1.6 percent.