There were more newly-built units completed over the December 2016 quarter than houses, the first time on record this has occurred, according to new building activity data released by the Australian Bureau of Statistics (ABS).
Moreover, the number of new dwellings approved for construction has fallen from historically high levels. The ABS’s latest building activity data shows that dwelling commencements and completions were higher over the quarter. Meanwhile, the number of dwellings under construction, as well as the number of dwellings approved but awaiting commencement, actually fell, according to analysis by CoreLogic.
For dwelling completions, 28,102 new houses and 28,527 new units completed construction over the December quarter, making this the first quarter on record when more new units were completed than new homes.
New house completions increased by 0.7% over the quarter, while new unit completions surged an astonishing 26.1% to reach a new record-high.
In addition, over the December quarter, 28,690 new houses commenced construction and 27,887 new units commenced construction, meaning that while new house commencements were -3.4% lower, new unit commencements had risen by 3.9%.
“It’s reasonable to expect that dwelling commencements will follow the lead of approvals and start to trend lower over the coming quarters,” said Cameron Kusher, research analyst at CoreLogic.
According to Kusher, there has been little change in the number of houses under construction over recent quarters, while new unit construction remains historically high but has begun to decline.
“When you look at the individual state data, the number of new units under construction in New South Wales is continuing to climb to new historic highs while the number under construction in Victoria and Queensland, where concerns around inner-city unit supply are more pronounced, is now clearly trending lower,” he said.
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