House building approvals plateau as stimulus winds back

author-avatar By on May 05, 2021
House building approvals plateau as stimulus winds back

New data released today shows units drove the dwelling approvals boom in March, up nearly two thirds in just a month.

The Australian Bureau of Statistics' (ABS) data for March's dwelling approvals shows there were 8,563 units approved for building in March - an increase of 63.6% over February.

This was the main contributor to the second-highest number of total dwellings approved, up 17.4% on the month, and 47.4% on the year.

The highest number of dwellings approved on record was in November 2017.

By contrast, in March, private sector housing approvals were up 0.1% to 14,117 approvals.

Looking to build a home? Below are a handful of low-rate construction loans in the market.

However, this number is still at an elevated level, with numbers up 60.7% compared to March 2020, according to ABS director of construction statistics Daniel Rossi.

"The number of private sector house approvals also remained at elevated levels due to HomeBuilder, edging up 0.1 per cent to a new record high in March," he said.

There was a 10.5% monthly fall in private sector housing approved in New South Wales, a 4% fall in Queensland, and 0.1% fall in Western Australia. 

The HomeBuilder grant was reduced from $25,000 to $15,000 in the new year, and wound back after March.

In total there were 23,176 dwellings approved in March, for a total value of just over $7.8 billion, amounting to an average of almost $338,000. 

Housing Industry Association senior economist Nick Ward forecasted the building boom to continue for the foreseeable future.

"We anticipate a record volume of building work will commence this year, and into 2022, with more than 130,000 new detached homes to commence construction," he said.

“The record volume of work will see the industry absorb workers from across the economy.

"This surprisingly strong result was driven by a rise in approvals for town houses and high rise apartments in NSW, Victoria and Queensland."


Photo by Josh Olalde on Unsplash

Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:

  • The big four banks are: ANZ, CBA, NAB and Westpac
  • The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2020. They are (in descending order): Great Southern Bank, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
  • The larger non-bank lenders are those who (in 2020) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.
  • If you click on a product link and you are referred to a Product or Service Provider’s web page, it is highly likely that a commercial relationship exists between that Product or Service Provider and Savings.com.au

Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site.

In the interests of full disclosure, Savings.com.au, Performance Drive and Loans.com.au are part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.

*The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.

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author-avatar
Harrison joined Savings in 2020. He is an experienced journalist, with previous stints at News Corp and financial comparison site Canstar. With a keen interest in personal finance, Harrison is passionate about helping consumers make more informed financial decisions.

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