Building approvals in October made a solid start to the 4th quarter with a sharp rise in the normally volatile series from the Bureau of Statistics. Total approvals rose 3.9%, seasonally adjusted, according to the ABS. That was up from a restated 2.3% rise in September from 2.2%.
And driving the rise was a big rise in the number of approvals for apartments, units and townhouses – they were up 10.6% from September, while private house approvals were down 1.9%.
The month on month result was better than market forecasts for a 2.5% fall and confirms the investment boom in housing will run well into 2016.
Year-on-year, approvals were up 12.3% , down from the revised 22% (previously 21.4%) in September.
The reason for that was a slide in the annual growth rate in the number of private units and apartments – the rate slowed from more than 53% in September to a still very solid 29.6%.
The annual growth rate for private houses went from a rise of 1.5% to a fall of 1.9% in October.
This statistical series bounces all over the place because it depends on local governments which often process their data in fits and starts, especially for large scale home unit construction (which are lumpy by their very nature because of the number of units involved in some projects).
But it is another sign that the momentum in the property sector on all sides is slowing, but not sliding like mining investment is.
Certainly that impression is supported by the latest house price data from CoreLogic RP Data’s monthly survey for November, released yesterday.
The 1.4% fall last month from October in Sydney was the largest monthly fall for five years. Melbourne led the way nationally with a 3.5% drop as the heat really went out of the market down south.
Hobart dwelling values dropped 2.4%, Darwin values were down 1.3% and in Canberra there was a fall of 0.5%.
But values rose in the remaining three capital cities, with Adelaide showing the highest month-on-month growth rate (0.7%), followed by Brisbane (0.6%) and Perth (0.3%).
But Sydney home prices are still up 12.8% in the past 12 months. That’s still better than the national average of 8.7%, but it is sharply down on the 18.4% figure mid year.
