The building boom in the detached housing segment is projected to be sustained over the next 12 months and into 2023.
Figures from the Australian Bureau of Statistics (ABS) showed a 3.6% seasonally-adjusted growth in the total number of dwellings approved in November, rebounding from the 13.6% fall in the preceding month.
ABS director of construction statistics Daniel Rossi said the rise in the total number of dwellings approved in the month was driven by detached dwellings, which posted a 9.7% growth.
“The series has been at historically elevated levels over the past year, largely driven by government stimulus and record low interest rates,” he said.
“While private house approvals are no longer at record highs, the November result remains 25.8% higher than the pre-pandemic level in November 2019, indicating on-going strength in the detached housing market."
Overall approvals increased the highest in Tasmania (40.8%), followed by Queensland (20%) and New South Wales (5.4%).
The total value of residential building increased by 7.1% in the month, comprised of the 8.5% gain in new residential building that offset the 0.8% fall in renovations.
Housing Industry Association (HIA) chief economist Tim Reardon said the approvals for detached homes in the month achieved the strongest growth since February 2000.
“Detached approvals remain elevated in all jurisdictions — This boom in detached home building is set to be sustained well into 2023,” he said.
Mr Reardon said the multi-unit segment has also started to emerge from the impacts of the pandemic, recording a 7.5% increase in approvals in the month.
“This is an encouraging sign that apartment construction will return prior to the return of overseas migration.
“All indications continue to demonstrate that demand for building services and materials will remain elevated in all regions throughout 2022 and well into 2023.”
Photo by @jeriden94 on Unsplash
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