If the retail sales and private credit reports were a bit better than expected, the news from the housing industry was very much on the mixed side.
Thanks to another drop in non-private dwelling, overall building approvals were again weak in February, despite a small rise in private dwellings (which was the important news).
But home prices were flat in February, according to the RP Data Rismark monthly survey to be up less than 1% in the year to February.
That was after mixed news on new home sales earlier in the week.
The Australian Bureau of Statistics said yesterday that the figures show that the total number of dwellings approved fell 7.4% in February 2011, in seasonally adjusted terms, after falling 11.6% in January.
The big driver was a 20% drop in seasonally adjusted estimate for private sector other dwellings approved in February, following a fall of 20.4% last month.
Big falls were recorded in some states, especially Victoria, Queensland and Western Australia. The fall came after the market forecast a 4% rise.
The fall took the number of approvals to 12,011 for February, seasonally adjusted, from an upwardly revised 12,975 units in January.
In the year to January, building approvals were down 21.8%.
According to the ABS, Victoria (-23.1%), Queensland (-11.8%) and Western Australia (-7.4%) recorded fewer dwelling approvals this month while Tasmania (44.6%), South Australia (35.8%) and New South Wales (7.7%) recorded increases in seasonally adjusted terms.
Private sector houses approved rose 0.2% in February with rises in New South Wales (7.4%), South Australia (4.8%), Queensland (1.1%) and Western Australia (0.4%) while Victoria fell (-6.9%).
The value of total building approved rose 13.7% in February in seasonally adjusted terms.
The value of total residential building fell by 2.9% while non-residential building rose by 59.3%.
The ABS said that the flooding in the eastern states, particularly Queensland, and other recent natural disasters "have not adversely affected participation by providers in the Building Approvals collection or the quality of estimates in this release. However, these events may have had an impact on the number of approved dwellings and the value of approved work in February 2011".
House prices were steady in February following a revised 1.5% fall, seasonally adjusted, in January, according to RP Data-Rismark. (An impact of the flooding in Brisbane and the rest of Queensland.)
January’s fall was the biggest decline since 2005 when the index began.
RP Data-Rismark said that flat dwelling values were recorded in the capital cities (0.0% seasonally-adjusted or a slightly stronger +0.7% in actual ‘raw’ terms).
"The ‘rest of state’ areas, which account for the 40 per cent of homes not located in the capitals, also displayed some improvement during February with house values rising by 0.5 per cent seasonally-adjusted (+0.3 per cent raw).
"Over the 12 months to end February, Australia’s capital city home values have hardly moved, rising by only 0.8 per cent. The story is the same in the rest of state regions, where home values remain unchanged (-0.2 per cent) over the last year.
"When you consider that Australian inflation was 2.7 per cent in the year to December 2010, in real terms Australian residential property values have been declining, which is a good outcome for prospective buyers," said RP Data senior research analyst Cameron Kusher yesterday.
The Reserve Bank lifted official interest rates in November and banks added to that increase, which seems to have achieved the same impact as a 0.5% rise in official rates, judging by the impact on home prices and retail sales.
The survey showed that Melbourne prices slumped 1.8% in the three months to February, seasonally adjusted, while they edged up 0.3% in Sydney over the same period.
In the three months to February home prices tumbled 3.3% in flood-hit Brisbane, while Perth values dropped 1.9% in that period, seasonally adjusted.
And earlier in the week, figures showed a slight rise in new home sales in February.
The Housing Industry Association – JELD-WEN new home sales report said house sales rose 1.5% in the month, while apartments, units and townhouses dropped by 7.6%.
“New home sales are running at volumes considerably below those experienced during the stimulus-driven run of 2009 and early 2010, while both local government building approvals and new housing loan approvals are trending down once more,” HIA chief economist Harley Dale said in the statement.
“At the very time when new home conditions need to be continually improving we are faced with compelling evidence of a considerably weaker 2011 compared to last year,” said Dr Dale.
New house sales in New South Wales rose 0.9% in February and 2.9% in Victoria. In flood-hit Queensland, they dropped 13.3%. They also dropped 4.3% in South Australia and 2.2% in Western Australia.
