Compared to the previous year, building approvals fell 1.6% in February, despite an 8.7% rise in the number of private dwellings approved. The big driver was a very sharp 19.4% slump in private sector other dwellings, flats, units and townhouses.
The Australian Bureau of Statistics (ABS) said the seasonally adjusted estimate for private sector houses approved rose 0.8% in February following a rise of 2.4% in January; and the seasonally adjusted estimate for private sector other dwellings approved fell 0.9%.
In numerical terms, approvals to build private houses rose 0.8% to 9,138 in February and approvals for apartments and renovations declined 0.9% to 3,611.
The Housing Industry Association said approvals were heading in the wrong direction:
“Total building approvals were flat in February (up by all of 0.1 per cent) to be at a level 1.6 per cent lower than a year earlier. Multi-unit approvals fell by 1.3 per cent to 3,814, their lowest level since May last year. Approvals for detached houses inched up by 0.8 per cent to a level of 9,332,” HIA Chief Economist, Harley Dale said.
“Building approvals were down over the three months to February 2008 for multi-units in particular, but also for detached houses” Mr Dale said building approvals updates were suggesting the gap between housing supply and demand was set to widen before stabilising:
“Detached house approvals have been trending (moderately) down again for three months now, while for the multi-unit segment there is a downward trend apparent over the last four months,” Mr Dale said.
“All leading indicators of new housing, including building approvals, are pointing to flat to weaker residential construction levels in the short term.” “Looking at the three months to February this year, building approvals have weakened in every state and territory in Australia except for Tasmania and the Northern Territory,” Mr Dale said in a statement.