LA Private

Oz residential construction crisis deepens

The Australian Bureau of Statistics said on Tuesday that April saw an 8.1% slide in total approvals, seasonally adjusted, a much steeper than the 1% drop in March (which was revised from the original estimate of a drop of 0.1%) and an 11-year low.

The total approvals figure of 11,5984, was the lowest since early 2012 and means approvals are now more than 24% under the level of April last year and half the peak 23,216 approvals reported in March 2021 as the HomeBuilder subsidy expired.

Once again it was the slide in approvals for apartments, home units and townhouses that drove the slide but private house approvals again weakened.

ABS head of construction statistics Daniel Rossi said in Tuesday’s release, “Total dwellings approved fell to the lowest level since April 2012. The overall decline was driven by a fall in approvals for private sector dwellings excluding houses, which fell 16.5 per cent, to the lowest level since January 2012.”

The seasonally adjusted estimate for private sector house approvals fell 3.8% in April, to 7,939 (the lowest since March, 2013), following a 3.7% drop in March. Private sector dwellings excluding houses approved fell 16.5% in April, following a 5.0% rise in March.

That left private dwelling approvals down more than 18% in the past year, while approvals for apartments, units etc are now 35% below where they were in April, 2022.

The ABS said nationally, total dwelling approvals were mixed, with falls in Queensland (-22.8%), Victoria (-18.6%), and Western Australia (-5.8%). Rises were recorded in South Australia (+19.8%), NSW (+12.5%), and Tasmania (+3.5%). the apparent surge in approvals in NSW and South Australia were most likely to bunching at local government level with councils bulk approving to clear a backlog.

Approvals for private sector houses fell in Victoria (-9.3%), Queensland (-6.0%), and NSW (-1.7%) while rises occurred in South Australia (+10.8%) and WesternAustralia (up 0.1%).

The value of total building approvals rose 4.7%, following a 5.7% fall in March. The value of total residential building approvals fell 2.5%, comprised of a 2.7% fall in new residential building and a 1.2% fall in alterations and additions.