Long-tailed pipeline
Having spiked dramatically through the HomeBuilder stimulus, seasonally adjusted new dwelling commencements dropped to just 48,000 in the June quarter.
Despite this, there was still a huge 242,000 dwellings under construction in the June quarter, as high as we've ever seen in Australia.
This 'long tail' may help to take some pressure off rental markets as internal migrants head from the regions back to the major cities and CBDs open for business again.
The number of attached dwelling units under construction, meanwhile, held up over the quarter in each of the main states.
It's not hard to see that a sharp slowdown in dwelling construction is coming; in fact, it's already underway as confirmed by private measures in the form of activity gauges.
As James Foster points out, this will prove to be a strong disinflationary force over the year ahead.
