Oz housing market stays cool, but less cold

Company News

by Glenn Dyer

The slide in home building approvals slowed in April following the steep swings over the first three months of the year.

Australian Bureau of Statistics data showed a 2.4% drop last month to 14,908, a far better outcome than the 19.2% slump in March

Private sector home approvals rose by 0.5% to 10,077 after a 3.9% fall in March while other dwellings fell 6.1% to 4,701.

On an annual basis, the falls are huge – more than 32% for all approvals, more than 33% for private homes and 28.7% for apartments, townhouses units etc.

At the same time the Reserve Bank of Australia’s latest credit figures showed demand for loans remained solid in April and prior to the central bank’s first rate increase in more than a decade at the start of May.

Total credit rose 0.8% to an annual rate of 8.6%, the fastest yearly rate since late 2008.

Housing credit grew 0.6% in April, unchanged from March, but well ahead of the 4.4% rise a year earlier. Total housing credit grew 7.9% in the year to April, unchanged from March.

Total private housing credit rose an annual 9.0% in the month while investor lending was up 5.8%.

Business credit jumped 1.4% in April to be up more than 11% for the year. That was the biggest annual rise since November, 2008.

The ABS said that the number of dwelling approvals fell by 6.8% in NSW, 4.5%, Queensland (-4.5 per cent) and by 0.3% in WA, seasonally adjusted.

Dwelling approvals rose 50.3% in South Australia (a very odd outcome), Tasmania (by 10.6%) and Victoria (7.8%). Approvals for private sector houses rose in South Australia (down 7.7%) and Queensland (down 6.2%), but fell 3.6% in NSW and 0.9% in Victoria and by 0.2% in WA.

The ABS said total buildings approved fell 12.0% in April. The value of total residential building rose 4.7% by after the 18.7% fall in March.

The rise in total residential building was made up of a 6.6% rise in alterations and additions and a 4.4% increase in the value of new residential building approved.

Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

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