A surge of approvals in Queensland and a last minute rush to get the revised first home owners grant has resulted in a rise in dwelling approvals across Australia in June.
Total approvals rose by 0.5 percent as a result of a 3.5 percent increase in detached house approvals, more than offsetting a 6.8 percent fall in the number of multi-unit approvals.
The Housing Industry Association (HIA) says that the figures, which were released today, have added further weight to the argument that the industry has a head of steam that will see it through to the end of this year.
Ruth Morschel, the HIA’s executive director of public affairs and policy, says that despite the recent slowdown in new home lending, the fundamentals for new housing are still there. “It’s still a bit too early to factor in the effect of the two interest rate rises but overall conditions remain favourable,” she says. “For interest rates, clearly the pressure for further rate rises has been eased as a result of the recent US sharemarket woes.
“In addition, there has been very little overbuilding during the recent upturn and construction costs have been kept under control. The higher than estimated population growth figures from the recently-released Census suggest that current activity is only marginally ahead of the underlying demand fo new homes.”
Morschel notes that while forecasts are for a 13 percent decline in housing starts this financial year, this will be offset by the booming home renovation market which had $352m worth of work approved over the most recent month.
State by state, Tasmania and Queensland recorded rises in approval of 59.7 percent and 17.6 percent respectively; New South Wales was down 13.1 percent, Western Australia was down 6.3 percent and Victoria was down 4.5 percent.
Source: Building Products News.