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September’s Building Approvals figures released by the Australian Bureau of Statistics (ABS) have shown an increase of 4.4 per cent in the total number of dwellings approved to 14,842 after a fall of 3.9 per cent in August.
Annually, building approvals are now 6.8 per cent above the same levels in September 2023 in seasonally adjusted terms.
ABS head of construction statistics, Daniel Rossi, said this monthly rise was driven by “increases across all dwelling types”.
Private sector houses reached 9,745 approved in September, to be at the highest level since August 2022.
“Private dwellings excluding houses rose by 4.7 per cent, but remain at subdued levels following a 13.5 per cent fall in August,” Rossi said.
Additionally, the value of total buildings approved increased by 1.4 per cent to $13.61 billion, following a 1.1 per cent rise in August, with the value of total residential buildings remaining flat at $8.04 billion, made up of an increase of 0.2 per cent in new residential buildings ($6.88 billion) and a 1.3 per cent fall in alterations and additions ($1.16 billion).
The total increase was driven by a rise in the value of non-residential buildings, up 3.6 per cent in September (to $5.57 billion) following an 11.3 per cent increase the month prior.
Meanwhile, detached house approvals rose 6.1 per cent nationally to 9,890, the highest monthly number in two years, according to HIA economist Maurice Tapang.
“There were 28,970 detached house approvals nationally in the September quarter 2024. This is 4.1 per cent higher than in the previous quarter and 12.9 per cent higher than at the same time in the previous year,” Tapang said.
“It has been a year since the RBA last raised interest rates. Unchanged cash rate settings, supported by strong population growth, low unemployment levels and acute housing shortages, have helped lift consumer sentiment.
“The result seen in house approvals data continues to confirm that the market is past its trough, and more buyers are building a new home especially in those markets outside of Sydney.”
Tapang further said that the cost of home building materials is growing “at a more normal pace”, simultaneously with build times for houses reaching back to pre-pandemic levels.
“The price of shovel-ready land, however, remains prohibitively high especially in Sydney,” Tapang said.
“The volume of apartment construction needs to double current approvals numbers in order to achieve the Australian Government’s target of 1.2 million homes over five years.”
[RELATED: Building approvals witness a decline: Are regulatory changes to blame?]
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