House approvals to fade
There was a tidy bounce in unit approvals in December, driven by Melbourne developers anticipating a resurgence in demand as borders reopen.
Private sector house approvals of 10,444 were 21.3 per cent lower than a year earlier, however, as the HomeBuilder stimulus effect wears off.
Overall, the trend for house approvals is likely to slow quite significantly over the next year, acting as a drag on growth (and inflation in materials and trades services).
Building approvals have been very sprightly through the past year, but the rolling annual total for approvals has gradually slowed since September 2021 from 232,000 to 228,000 at the last count.
The government's advertising campaign to bring back the backpackers suggests we might expect to see the immigration lever pulled quite hard over the period ahead.
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James Foster with the detailed analysis here.
