Pete Wargent blogspot


'Must-read, must-follow, one of the best analysts in Australia' - Stephen Koukoulas, ex-Senior Economics Adviser to Prime Minister Gillard.

'One of Australia's brightest financial minds, must-follow for accurate & in-depth analysis' - David Scutt, Markets & Economics Editor, Business Insider.

'I've been investing 40 years & still learn new concepts from Pete; one of the best commentators...and not just a theorist!' - Michael Yardney, Amazon #1 bestseller.

Tuesday, 30 May 2017

Approvals still shaping down

Approvals tailing off

After revisions, building approvals took a substantial tumble in from 18,595 in February to just 16,675 in March, so it was no surprise to see a bit of a rebound in April, back up to 17,414.

The "approvals rebound" headlines just write themselves, of course!

Still, though, we are heading down forthwith. 

Let's take a look at the key figures.

Total approvals were 17.2 per cent lower than a year ago, when they printed at a massive 21,023.

Approvals for units, townhouses, and apartments were down by 26.2 per cent from 10,999 in April last year to 8,116 last month. 

And the annual number of 'high rise' approvals of four or more storeys has continued to decline, down by 16.7 per cent from the record peak of 77,859 in October 2015 to 64,865.

Around the traps

In Perth, annual detached house approvals have fallen by 39.2 per cent from 20,483 in December 2014 to 12,456.

In Brisbane, attached dwelling approvals continue to drop like a stone, down by 41.4 per cent from 20,843 in February 2016 to just 12,210. 

In Greater Darwin, not a single apartment was approved in the month of April, with that particular sector of the market having been shot to pieces in recent years.

And finally, high rise approvals are well below the peaks and falling in all of the three most populous states. 

The wrap

In short, yes, there was a monthly "rebound" of sorts, and the residential construction pipeline remains very large.

But approvals and building activity are still heading down over the next 24 months.

And this is set to put some developers and companies in other sectors under pressure - for more detailed sectoral analysis our monthly subscription reports provide the goods - get involved here.