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Housing approvals at near-record levels

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The ongoing surge in new homebuilding provides further evidence that the housing boom may be drawing to a close.

The Australian Bureau of Statistics reported that 18,768 dwelling units were approved in February. That marked a 14.3 per cent jump on the previous year.

The February result was the second-best in history and not far off the record 19,282 approvals in January.

Private sector house approvals fell 1.0 per cent in February. However, there was a 36.2 per cent jump in approvals for all other private sector dwellings, which are mainly units.

Housing Industry Association senior economist Shane Garrett said housing approvals remain at exceptionally high levels, and that there is a solid pipeline activity for the months ahead.

“A steady pipeline of new homes represents the most effective solution to alleviating housing affordability pressures,” he said.

The rise in supply has coincided with a decline in property price growth.

Australia’s eight capital cities grew by an average of 3.1 per cent during the 12 months to 31 March 2015, according to CoreLogic RP Data.

Price growth remains at double-digit levels in Sydney, but it has slowed noticeably in Melbourne.

Adelaide and Brisbane are growing at little more than the inflation rate, while Perth, Canberra, Darwin and Hobart are under the inflation rate.

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