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    HIA reports easing of home building approval numbers

    Housing Industry Association

    The Housing Industry Association (HIA) has quoted the latest ABS figures to report that residential building approvals have slipped back for the third consecutive month in April 2014 after reaching a decade high in January. The HIA is the voice of Australia’s residential building industry.

    According to HIA Economist Geordan Murray, the monthly volume of building approvals in April 2014 continued to recede from the decade high achieved back in January, although the number of approvals, which is close to 15,000 dwellings is still a very positive result.

    In April 2014 total building approvals fell by 5.6 per cent to 14,931 (seasonally adjusted). Detached house approvals were effectively flat in the month (-0.1 per cent) but remained at a level that is 16.1 per cent higher than April a year ago. Approvals for ‘other dwellings’ fell by 13.5 per cent in the month and were down by 17.0 per cent compared to the level a year earlier.

    Geordan Murray explains that the pace of building approvals late in 2013 and early 2014 moved well ahead of the pace of home building commencements. Though there has been moderate building approval activity over the recent months, the pipeline of residential building work already approved should sustain a historically high level of activity throughout the middle part of the 2014.

    While declining numbers of multi-unit approvals have been behind the recent decline, they still represent a historically large share of multi-unit dwellings in the pipeline. The longer build time associated with the larger multi-unit development projects means that work already approved could well sustain activity for some time to come, he added.

    HIA expects to see the improved levels of residential building activity reflected in a stronger contribution to GDP growth in the March 2014 quarter when the National Accounts are released later in the week.

    Seasonally adjusted building approvals increased in April 2014 in Victoria (+14.8 per cent), South Australia (+12.2 per cent) and Western Australia (+4.4 per cent), and declined in New South Wales (-22.8 per cent), Queensland (-20.3 per cent), and Tasmania (-10.4 per cent). In trend terms, building approvals declined by 12.0 per cent in the Northern Territory and 5.8 per cent in the ACT.

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