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While the growth rate of house building approvals continues to accelerate, it remains well below the previous peak and is tipped to decline as government support expires later this month, a new report has revealed.
The latest National House Building report by Archistar revealed a continued surge in house building approvals, with activity levels largely driven by the federal government’s HomeBuilder initiative.
The annual rate of growth of house building approvals increased by 17.2 per cent over the year ending January 2021, compared with the same period the previous year.
However, this rate remains well below the previous peak of 2018, according to Archistar chief economist Dr Andrew Wilson.
Moreover, HomeBuilder’s impending end – the modified grant of $15,000 is set to expire on 31 March – is expected to put a damper on the currently strong approval rates. And while Dr Wilson expects the strong economy to offset some of the damage created by the changing conditions in April, home approvals are tipped to decelerate.
“A strongly rebounding economy and booming housing markets generally will continue to support home building despite a declining population – albeit at lower levels from the current strong results,” said Dr Wilson.
Despite Melbourne recording the lowest annual growth rate in house building approvals, the Victorian capital recorded the highest number of building approval numbers in January 2021 at 1,693, followed only by Perth with 1,365.
During the same month, Adelaide recorded the lowest number of building approvals at 556, followed by Sydney with 896 and Brisbane with 929.
Overall, Melbourne now has the highest number of building approvals at 27,022, followed by Sydney (15,629), Perth (13,206), Brisbane (13,119), Adelaide (7,193), Hobart (1,477), Canberra (1,209) and Darwin (374).
Meanwhile, Adelaide had the lowest average cost per approval at $268,908 as of January 2021, followed by Perth with $286,861 and Brisbane with $288,593.
In contrast, Sydney and Melbourne had the highest average cost per approval at $372,022 and $346,678, respectively.
Top LGAs for building approvals
Over the year, Victorian local government areas dominated the list of LGAs that recorded the highest number of building approvals across the country, based on figures from the Australian Bureau of Statistics.
LGA | Annual building approval
(Vic) | 5,698
Melton (Vic) | 4,563
Moreton Bay (Qld) | 3,621
Casey (Vic) | 3,614
Hume (Vic) | 3,353
Greater Geelong (Vic) | 3,273
Brisbane (Qld) | 3,267
Blacktown (NSW) | 3,172
Logan (Qld) | 2,778
Whittlesea (Vic) | 2,462