The number of dwellings approved in January 2010 sank 7.0% following a rise in the previous month according to the Australian Bureau of Statistics. The dramatic drop was mostly due to a slump in privately owned apartments and houses.
Tasmania recorded the biggest fall in the number of dwellings approved, down 27% in the same period while Victoria fell by 15.9% and Queensland slid by 7.4%.
The value of total building approved fell 24.6% in January with the value of both residential (-6.2%) and non-residential building approvals (-41.9%) falling.
In spite of the poor start to 2010, building approvals remain 47.6% higher than 12 months ago and augur well for a spirited recovery in housing starts through 2010 according to HIA senior economist, Ben Phillips.
"The fundamentals of strong population and employment growth can be expected to push high housing demand. Without an adequate supply response, price pressures and further erosion of housing affordability will be inevitable," said Phillips.
HIA is forecasting a boost in housing starts of 16% in 2010 compared to the disastrous year in 2009.