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Australian building approvals highest in two decades

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The number of building approvals in Australia increased during October of this year to reach a 20-year high, according to insight from the Australian Bureau of Statistics (ABS) and Master Builders Australia.

Figures released by the ABS on December 2 show that dwelling approvals rose by 0.6 per cent in October, continuing a five-month growth streak. Tasmania showed the strongest growth, with the number of dwelling approvals in this state increasing 1.9 per cent.

Increases were also noted in Victoria, South Australia, the Australian Capital Territory, Western Australia and New South Wales, ranging from 1.7 per cent to 0.3 per cent.

While these results are pleasing enough on their own, further analysis from Master Builders Australia shows that this level of building approvals is the highest seen in two decades.

"Record strong approvals are setting the scene for an expansion phase is residential construction including in the pipeline of work expected to strengthen as approvals in detached houses and renovations improve," explained Master Builders Australia's Chief Economist, Peter Jones.

"In October in original terms 19,032 dwelling units were approved, the third highest monthly result on record. In seasonally adjusted terms, approvals rose by 11.4 per cent driven by a 30.4 per cent bounce-back in multi-unit approvals."

However, Mr Jones noted that there is still a lot more work to do. He indicated that the residential building cycle needs to further strengthen to aid a transitioning economy, and that red tape surrounding land release, taxes and charges may threaten growth.

In any case, high levels of building approvals signify an opportune time for property developers in the country. Thanks to the availability of property feasibility software, professionals in the sector can better gauge the potential of their projects.

Date Published: 03 Dec 2014
Category: General News

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