Approvals hanging in there
Detached house approvals dipped in September, but strength in Perth and Brisbane home approvals held the national total figure at a buoyant 10,432, seasonally adjusted.
The most recent three months of data, however, suggest that in real time momentum is now decreasing across all states and territories.
Unit approvals bounced in September, but it's likely that we'll be on the way down from here, as the appetite to buy new units has plummeted since the Budget.
Overall, there were 17,948 approvals in September, which was a solid enough headline result.
Granted, many of these medium- and higher-density projects will now likely be scrapped.
Despite the pick-up in building approvals in 2026, the trajectory has still been a long way short of the government's target.
There was a leap in the value of work approved for data centres, which is separately pulling some of the focus away from housing construction.
The wrap
Overall, 2026 has been a stronger year for building approvals, but momentum in the less volatile detached house segment is now fading all across the country, while apartment pre-sales have also dived over the past few months.
Cotality released its home values index update for the month of October, which recorded a 7th consecutive monthly drop.
The biggest monthly declines have now shifted from the largest capital cities across to Brisbane (-2 per cent) and Perth (-1.7 per cent).
Source: Cotality
The beginning of the downturn was driven by the upper price quartile of the market, with detached house prices in Sydney now -11 per cent lower than a year earlier (versus bullish forecasts for gains in 2026).
Dr Alex Joiner of IFM Investors tabulated the figures below:
Source: IFM Investors
However, various sources now seem to be suggesting that many of the cheaper regional markets which soared across the past few years as investors piled in are now leading recent price declines.
Markets are betting on an interest rate hike on Melbourne Cup Day interest rate hike being the final hike in the cycle.
Meanwhile, major banks are busily downgrading economic growth forecasts, with NAB now projecting that the unemployment rate will rise to 5.4 per cent in 2027 (the banks themselves cutting roles will likely be a part of this)
For that matter, banks are also downgrading their previously upbeat housing market forecasts, with Westpac now expecting a decline of -10.9 per cent for the year to March 2027, before prices then rebound in 2027 and 2028.
Commonwealth Bank expects the recovery to be pushed out until September 2027, with a peak-to-trough decline of -9 per cent, while NAB and ANZ also see a peak-to-trough decline of around 10 to 11 per cent.
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