Lending for building crashes
Building approvals were once again atrocious at around 12,600 in February, the recent weakness being driven by a drop in unit approvals in Sydney and Melbourne.
Pre-sales are far too weak to get new projects out of the ground, and apartment prices will need to rise significantly from here before that changes.
House approvals were also still weaving lower over the year in all the main capital cities: Sydney, Brisbane, Perth, Melbourne, and Adelaide.
The trend for building approvals thus continued to decline to the lowest level in 128 months.
The elephant in the room is that with developers going insolvent all over the place many of these approvals will never got off the start line either.
It's little wonder markets are starting to price in rate cuts over the year(s) ahead, and lending/housing policies are much too tight at the moment to arrest the downward trend for approvals.
Lending for new home construction has crashed to the lowest level since the global financial crisis in November 2008, reported Tim Reardon of the HIA:
Source: HIA
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There is at least some growing pressure to remove the constraints on lending assessment buffers, as discussed by Leith van Onselen at Macrobusiness here.
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Stock for sale remains at very low levels, and as such dwelling prices have been ticking higher for 2-3 months now in many parts of the market.
CoreLogic reported price increases for Sydney in March, as well as blistering increases in unit rents.
