While sales of new homes may have taken a fall in May, construction approvals strengthened over the same period.
Figure from the Housing Industry Association show 19,144 constructions were approved during May, a 2.4% increase on the April total of 18,964.
That increase was driven by surge in approvals for multi-unit developments, which saw a 15.1% increase in approvals during May, while detached housing approvals saw a decrease of 8.5% over the month.
“During May, dwelling approvals recorded their third highest monthly total on record,” HIA senior economist Shane Garrett said
“While it is positive to see improved levels of approvals, the distribution of growth was uneven with multi-units increasing significantly during the month and detached house approvals falling back,” Garrett said.
In 2014, a record number of new homes were built in Australia and the HIA believes the May approval numbers show that trend is continuing, but the lobby group has called for governments to ensure supply is able to keep up with growing demand.
“This onus is very much on policymakers here,” Garrett said.
“They must rectify the bottlenecks in the planning system, redress the excessive fees and charges on new residential developments and ensure that the pipeline of residential land will meet the ongoing community demand for new homes.”
During May, seasonally-adjusted new dwelling approvals increased in Victoria (11.0%), New South Wales (8.8%), the Northern Territory (9.7%), the ACT (6.0%), Queensland (3.6%) and Western Australia (0.2%).
Tasmania saw a significant 32.6% decrease, while approvals in South Australia fell by 9.9%.
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