“The November fall was the fifth consecutive month of declines, indicating an emerging trend of weakening approval activity,” said Dr. Andrew Wilson, chief economist at the Domain Group.
Despite yet another decline in capital city apartment approvals, 52,221 units were approved for building over the first 11 months of 2016. This represents an increase of 2,160, or a rise of 4.3%, compared to the same period in 2015.
As noted by Wilson, the year-to-date data reveals a clear disparity among the performances of the capital city markets. All capitals reported a decline in the number of building approvals recorded over the first 11 months of 2016 compared to the same period in 2015.
The clear exception to this trend is Sydney’s robust unit market, which has reported a rise of 5.6% in apartment approvals on the year-to-date comparisons. Sydney approved 36,302 units over 2016 to November, the highest of all the Aussie capitals. Melbourne came in second with 30,626.
In contrast, unit supply in the Brisbane market is evidently on the decline with just 489 approvals recorded over November. This was the lowest monthly total reported by the city since April 2014. Brisbane approved 15,595 units for building over the first 11 months of 2016, representing a decline of 17.5% compared to the same period a year before.
“Falling interest rates over recent years have generated significant housing demand overall which has translated into increased supply of dwellings,” Wilson said.
“This in turn has generated economic activity which has been a key factor in maintaining growth following the end of the resources boom. Apartment development has been a significant driver of this growth with units currently accounting for 42 percent of all dwelling approvals.”
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