Building approvals for detached homes declined by 3.1% in March after the strong performance in the previous month. But despite the decline in March and the weak performance in January during the holidays and the Omicron outbreak, detached home approvals for the first three months of 2022 were still 9.0% higher than the equivalent pre-pandemic quarter. Source: Timberbiz
“This continues to reflect the strong ongoing demand for housing in the first quarter of 2022, albeit at levels below those observed over the past two years,” HIA Economist Tom Devitt said.
“Multi-unit approvals declined by 37.7% in March to be down by 9.9% in the last three months compared to the equivalent pre-pandemic quarter.
“Affordability issues, land constraints and a return of overseas migrants, students and tourists will help support demand for units, townhouses and apartments,” he said.
“The value of renovations approved also remained elevated, with the last three months sitting 31.5% above the equivalent pre-pandemic quarter.
“The impact of this week’s rise in the cash rate on building approvals could take more than six months to emerge in this data set,” Mr Devitt said.
“The shortage of rental accommodation remains the key driver for demand for new homes in this cycle.
“The existing pipeline of work will keep builders busy this year and well into next year, limited by the availability of land, labour and materials,” he said.
In seasonally adjusted terms, total residential building approvals decreased in the last three months compared to the previous quarter in most jurisdictions, including Western Australia (-20.4%), South Australia (-16.2%), Victoria (-7.6%), and Queensland (-4.9%), while New South Wales saw an increase (+1.5%). In original terms, approvals decreased in the Australian Capital Territory (-21.4%) and Tasmania (-7.4%) and increased in the Northern Territory (+122.0%).
