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    MBA optimistic about growth in building approvals despite June drop

    Master Builders Australia (MBA)

    The June figures for building approvals are not a cause for worry, according to Master Builders Australia (MBA) .

    Master Builders Australia CEO Wilhelm Harnisch believes that the underlying strength in building approvals will continue and should help sustain growth in residential building despite the five per cent seasonally adjusted fall in building approvals for June.

    He explains that it is important to look beyond the monthly volatility in approvals for high-rise apartments, which saw a fall of 8.4 per cent seasonally of approvals for apartments down from the strong 25 per cent seasonally adjusted rise in May 2014. The softening of approvals for apartments is not unexpected given the exceptionally strong growth in the first half of this year.

    Wilhelm Harnisch observes that overall residential building approvals will continue to improve but at a slower rate. Queensland, for instance recorded a fall of 10.5 per cent seasonally adjusted in total dwellings approved in June following a rise of nearly 50 per cent seasonally adjusted in May 2014.

    He adds that approvals for detached housing are forecast to show continued growth, attributed to the undersupply of housing and the low interest rate outlook.

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