Australia: Dwelling approvals fall 5.6% in May - Westpac

Matthew Hassan, Research Analyst at Westpac, notes that Australian dwelling approvals fell 5.6% in May driven by sharp fall in units and againstmarket expectations of a 1.3% decline.

Key Quotes

“May approvals were down 19.7%yr.”

“The decline was driven by a 12.1% drop in ‘units’, with a  0.6% gain in private house approvals providing some offset.”

“The detail points to a sharp drop in ‘high rise’ (–20%) concentrated in NSW and Qld where total approvals were down 16% and 10.5% respectively.”

“Nationally, May saw the second lowest monthly reading on high rise approvals since June 2013 – the lowest being the weather-affected read in March.”

“All segments are down on year ago levels.”

“All major states are also seeing total dwelling approvals down on a year ago, the one exception being SA which has seen a modest lift in recent months led by high rise approvals (though still at a very low level).”

“The value of renovation approvals rebounded 12.7% in May from a 15.2% drop in April but is still trending lower and down 6.2%yr.”

“Non res building is looking more promising with a 5.3% gain maintaining a solid uptrend.”