Big slump in building approvals led by apartment drop, new data shows
Property Council's Matt Kandellaars says drop in home building approvals during July was disappointing.
HOME approvals fell sharply during July, according to the Australian Bureau of Statistics, which recorded an 8.2 per cent drop – to 15,769.
The new figures, which come after 12.2 per cent rise in June, were described as disappointing by the Property Council.
The drop was driven by a decline in the number of private sector dwellings excluding houses, which consists of semi-detached, terrace houses, townhouses and apartments.
Properties in that category fell 22.3 per cent to 5,943 dwellings, according to Daniel Rossi, ABS head of construction statistics.
This followed a 33.5 per cent rise in June, which was the highest result since December 2022.
The latest monthly figures were described as disappointing by the Property Council.
Australia must approve over 20,000 homes each month to reach the National Accord’s target of 1.2 million new homes needed by 2029.
The Property Council’s Matthew Kandelaars said: “It is heartening to see a concerted effort across the country to hit our housing targets, but today’s data shows that increased approvals across a single month or two won’t be enough.
“Progress is being made, but the supply pipeline remains constrained, as these numbers show.
“Apartment approvals can be volatile, but it is still disappointing to see a significant drop over the month.
“Despite this, we have seen welcomed growth.
“Overall home approvals are up 6.6 per cent from the same time last year, while private sector dwellings excluding houses approvals rose 12.5 per cent.
“A mix of elevated construction costs, shortages of labour, complex approval processes, punitive state taxes and low productivity on construction sites is putting strain on the industry’s ability to deliver housing.”
Master Builders Australia CEO Denita Wawn said the figures highlight both the positive signs and the challenges ahead.
“Builders are encouraged by the steady lift in detached home approvals and the strongest quarterly performance in nearly three years,” Wawn said.
“But the slump in higher-density approvals is a real concern because that is where the Accord will rely most heavily for delivery.
“Australians need more homes, and approvals are a critical leading indicator of future supply. Demand is there, but unless governments make it easier to get projects approved and more workers into the industry, that demand will remain unrealised.”
