What goes up...!
Seasonally adjusted building approvals dropped by 13.4 in March to 16,484, with unit approvals diving by 22.5 per cent.
Over the last year unit approvals are now down by a substantial 28.4 per cent.
Although the trend series is sneakily shaping upwards, in reality building approvals are now 20 per cent lower than they were a year ago.
Looking through the monthly noise annual building approvals have fallen from nearly 241,700 at the peak to around 225,400.
Most of the drop has been accounted for by 'high rise' apartments of four or more storeys, with annual approvals falling from 77,900 at the October 2015 peak to 67,600 in March 2017.
This isn't too much of a surprise, since high rise development is now by far the highest risk sector in the more densely populated property markets.
Brisbane construction slowdown
Drilling in to the capital city level figures we can see that annual approvals in Greater Perth increased for the first time since December 2014, having dropped by a crunching 39 per cent over that time.
The sharp drop in apartment approvals in March was mainly driven by hefty drops in Sydney - which saw the most subdued number of units approved since early 2016 - and Melbourne, although annual approvals remain elevated in both cities.
In Brisbane annual apartment approvals have dived by 37 per cent in only 13 months as developers chew their way through the record construction pipeline.
In Darwin unit and apartment approvals have fallen to almost zero over the past 10 months, responding to awful market conditions in the Top End.
Nationally the monthly drop was very much driven by the high rise sector, with huge drops recorded in each of the most populous states, as developers respond to the challenges now facing Chinese investors.
The wrap
While annual building approvals remain at historically high levels, total approvals are shaping their way back down towards ~200,000.
As noted yesterday, residential construction accounts for remarkably high share of Australia's labour force, so many of these employees will ultimately need to be rolled into new projects.
As noted yesterday, residential construction accounts for remarkably high share of Australia's labour force, so many of these employees will ultimately need to be rolled into new projects.
Tomorrow's 2017-18 Federal Budget is expected to announce infrastructure plans, so let's see what Treasurer ScoMo & Co. can come up with in this regard.
