Dwelling Approvals Hit Near Record Highs

New dwelling approvals strengthened during May and remain at high levels, according to the Housing Industry Association.

During May 2015, total new dwelling approvals rose by 2.4 per cent to 19,414 in seasonally-adjusted terms, compared with 18,964 in April. A rebound in multi-unit approvals saw a 15.1 per cent increase occurring during May while detached house approvals fell by 8.5 per cent during the month.

A total of 218,442 approvals were recorded in the year to May, a new record for approvals over any twelve-month period since records began in 1983.

HIA Senior Economist Shane Garrett said, “During May, dwelling approvals recorded their third highest monthly total on record."

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“While it is positive to see improved levels of approvals, the distribution of growth was uneven with multi-units increasing significantly during the month and detached house approvals falling back,” he said.

“During 2014, new home building reached an all-time high and today’s figures indicate that we can look forward to a solid pipeline of new home building during the second half of 2015. However, the recent strengthening of price pressures in several markets indicates that the supply of new homes will need to stay at elevated levels in order to fully address demand," Mr Garrett said.

“This onus is very much on policymakers here. They must rectify the bottlenecks in the planning system, redress the excessive fees and charges on new residential developments and ensure that the pipeline of residential land will meet the ongoing community demand for new homes."During May 2015, seasonally-adjusted new dwelling approvals saw the strongest increase in Victoria (+11.0 per cent), followed by New South Wales (+8.8 per cent) and Queensland (+3.6 per cent). A slight increase was also recorded in Western Australia (+0.2 per cent). New dwelling approvals fell significantly in Tasmania (-32.6 per cent) and in South Australia (-9.9 per cent). In trend terms, new dwelling approvals increased in the Northern Territory (+9.7 per cent) and in the ACT (+6.0 per cent) during May.