Apartment Approvals Drop further2 March 2020
The number of total dwellings approved rose 0.5% in January, in trend terms, according to data released by the Australian Bureau of Statistics (ABS) today.
In real terms, the data showed a -30% drop in total housing approvals on the previous month of December and a -12% drop on January of 2019.
The ABS tend to dismiss the original values preferring instead to report on trend and seasonally adjusted results which have the affect of smoothing out the monthly fluctuations. My preferred reference point is the 12 month moving annual total. Across the market, a total of 126,341 dwellings were approved over the 12 months to January 2020, down -0.95% on the previous month and down -18% on the 12 months to January 2019.
In January, only 3,041 apartments were approved nationally, down -47% on the previous month taking the total approvals over the last 12 months to just 57,958 apartments, down -22% on the previous year's annual total. On an rolling 12 month basis, Sydney is down -27% on the previous year, Melbourne down -13%, Brisbane down -39% and Perth up 2.6%.
In the detached housing market in January 4,049 dwellings were approved nationally, down -11% on the previous month taking the total approvals over the last 12 months to 68,383 dwellings, down -14% on the previous year's annual total. On an rolling 12 month basis, Sydney is down -24.5% on the previous year, Melbourne down -13%, Brisbane down -16% and Perth down -7.9%.
The figures show little end in sight to the slump in apartment construction market, which economists now say is dragging on economic growth. Reports last week revealed the ongoing decline in actual work in the apartment construction market.
Apartment developers are now likely to wait and see what impacts the coronavirus may have on supply chains and market sentiment before proceeding further with construction activities.