03/02/2016 - 13:26

Building approvals continue slide

03/02/2016 - 13:26

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The number of new homes approved for construction in Western Australia fell for a 15th consecutive month in December, with the industry flagging a downturn in national activity.

Building approvals continue slide
Dwelling approvals fell 3.1 per cent in Western Australia in December.

The number of new homes approved for construction in Western Australia fell for a 15th consecutive month in December, with the industry flagging a downturn in national activity.

Building approvals fell 0.1 per cent in Australia in the last month of 2015, with the trend estimate for the number of approved dwellings in WA down 3.1 per cent, according to the latest data by the Australian Bureau of Statistics.

“The trend estimate for total number of dwelling units approved in WA has fallen for 15 months,” ABS said in a statement.

“The trend estimate for the number of private sector houses fell 1.8 per cent and has fallen for nine months.”

Housing Industry Association senior economist Shane Garrett said during 2015, a total of 232,078 new homes received approval for construction, seasonally adjusted, which was 13.7 per cent higher than 2014’s result and was above every calendar year on record.

However, Mr Garrett said the data added to the body of evidence pointing to the start of a downturn in activity.

“During the December 2015 quarter, total approvals fell by 4 per cent compared with the previous three month period and multi-units accounted for a disproportionate share of the decline,” he said.

“New home building has been a crucial support to economic growth over the past two years, particularly in light of the mining investment downturn.

“The challenge during 2016 will be to manage the transition to lower volumes of new home building in an orderly fashion.”

Master Builders Association chief executive Wilhelm Harnisch was more bullish on the housing industry outlook.

He said the December building approvals figures remained strong despite a small dip in apartment approvals.

“The December building approval data confirms that confidence among new home buyers and investors remains strong, underpinned by the continuation of low official interest rates,” Mr Harnisch said.

“The industry expects new house building activity to remain buoyant for the rest of 2016, particularly if interest rates stay at the current low settings.”

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