Higher interest rates and financial markets turmoil took their toll on the Australian home building industry in February.
Economists had been looking for no growth in the month, compared to January and the Australian Bureau of Statistics said there was a rise of 0.1% in seasonally adjusted terms in approvals.
But that was hardly anything to write home about and the trend is still towards a slowing in activity, to match that in retailing.
The small rise in February’s number of approvals to build or renovate houses and apartments compared to the revised 1.4% gain in January (which originally was 1.9%), the Bureau of Statistics said in Sydney today.
Compared to a year earlier, building approvals fell 1.6% in February, despite an 8.7% rise in the number of private dwellings approved. The big driver was a very sharp 19.4% slump in private sector other dwellings, flats, units and townhouses.
The ABS said the seasonally adjusted estimate for private sector houses approved rose 0.8% in February following a rise of 2.4% in January; and the seasonally adjusted estimate for private sector other dwellings approved fell 0.9%.
The ABS also said that the seasonally adjusted estimate for the value of total building approved fell 14.4% in February; the seasonally adjusted estimate for the value of new residential building approved fell 4.2% in February. The seasonally adjusted estimate for the value of alterations and additions rose 1.7% and the value of non-residential building fell 26.7%.
In numerical terms, approvals to build private houses rose 0.8% to 9,138 in February and approvals for apartments and renovations declined 0.9% to 3,611.
The Housing Industry Association said approvals were heading in the wrong direction:
"Total building approvals were flat in February (up by all of 0.1 per cent) to be at a level 1.6 per cent lower than a year earlier. Multi-unit approvals fell by 1.3 per cent to 3,814, their lowest level since May last year. Approvals for detached houses inched up by 0.8 per cent to a level of 9,332," HIA Chief Economist, Harley Dale said.
"Building approvals were down over the three months to February 2008 for multi-units in particular, but also for detached houses" Mr Dale said building approvals updates were suggesting the gap between housing supply and demand was set to widen before stabilising:
“Detached house approvals have been trending (moderately) down again for three months now, while for the multi-unit segment there is a downward trend apparent over the last four months,” Mr Dale said.
“All leading indicators of new housing, including building approvals, are pointing to flat to weaker residential construction levels in the short term.” “Looking at the three months to February this year, building approvals have weakened in every state and territory in Australia except for Tasmania and the Northern Territory,” Mr Dale said in a statement.
If newspapers were a major source of job advertising then the news of a sharp fall in March jobs ads would be an interesting indicator, given the fall in retail sales and the desire of the Reserve Bank to see a slowing in demand..
But the fact is the internet now provides the overwhelming number of new job ads, compared to the once dominant newspapers, so the news of a fall in the papers jobs vacant ads is merely ‘interesting’.
The ANZ said yesterday the number of jobs advertised in major newspapers fell to its lowest level in more than 14 years in March.
The ANZ job ads series shows that the total number of website and print advertisements declined by a seasonally adjusted 0.7% per cent in March to a weekly average of 267,041.
But the number of jobs advertised in major metropolitan newspapers fell 10.5% in the month to 17,115 a week, the lowest number since October 1993. NSW saw the number of job ads at its lowest since December 1983.
The number of internet advertised jobs fell 0.1% in March to an average of 249,926 a week, so no real story, except that it is very bad news for the papers and their owners.
Newspaper job ads fell in every state and territory, with the Northern Territory experiencing the biggest decline of 31.1% and its biggest monthly fall on record.
