Housing approvals continue to drop in NSW

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New data on housing approvals from the Australian Bureau of Statistics (ABS) indicates that NSW’s approvals are dropping compared to Victoria’s.

The Urban Taskforce, which analysed the ABS’ data, said housing approvals in Victoria are now exceeding those in New South Wales, with 6,878 approvals in January compared with 5,410 in NSW.

“This is despite the fact that Victoria’s population is 20% lower than that in NSW,” the Urban Taskforce said.

The biggest drop has been in high-density apartments. While in July 2016, there were 4,361 apartments approved in NSW, this plunged significantly in January 2018 to 2,974.

“Victoria, even though it is 20% smaller than NSW in population, approved 3,626 new apartments in January 2018 compared to the 2,974 in NSW,” the Urban Taskforce said.

One market segment where NSW is ahead of Victoria is in the approval of non-residential projects. The value for NSW non-residential projects in January was $1.3bn compared to Victoria’s $1.1bn.

The drop in approvals in NSW is mainly occurring across Sydney, where the confidence level in starting projects has begun to taper off. “This has been as a result of substantial delays in getting approvals, uncertainty over levies and restraint from banks who are not lending as much as they used to for housing,” the Urban Taskforce said.

The industry group wants the Berejiklian government to carefully monitor the downward trend to ensure that housing supply approvals continue at higher levels. “The only way we can put downward pressure on housing prices is to ensure housing is supplied in the locations where people would like to live,” it said.

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