Official figures released by the Australian Bureau of Statistics show total new building approvals increased by 2.5% in July, bringing some relieving news to the property market.
Over the 12 months to July, total building approvals increased by 9.4%, reaching 195,227 new home approvals - which is the highest the market has seen yet, according to the Housing Industry Association.
“Total seasonally adjusted new home approvals over the past twelve months are the highest since records began back in 1984. Having broken through the 195,000 threshold for the first time, new home building approvals is now at an even higher level than during the 1994 building boom,” HIA Senior Economist, Shane Garrett said.
However, Garrett warns that we aren’t out of the woods yet. New home building approvals have shown signs of tapering off over the past six months, and the majority of growth in July was due to an exceptionally large expansion in Western Australia.
To ensure that the property market can benefit from the supply of new housing, Garret said the government needs to stop hindering new home building.
“The key is to ensure that a number of markets, like Sydney for example, achieve sustainably healthy levels of new home over the coming decade which far outweigh what has been built over the last ten years. Numerous government policies across all tiers stand in the way of this objective being achieved,” he said.
One of these obstructions is stamp duty, the HIA claimed. In a report released last week by HIA, the housing lobby called for policy reform on “onerous” stamp duties which can add thousands of dollars to mortgage repayments.
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