The month of September provided a second consecutive improvement for building approvals, said the Housing Industry Association.
"Today's building approvals data shows September 2012 provided a second consecutive monthly increase - up by 7.8 per cent in seasonally adjusted terms," said HIA Economist, Geordan Murray. "The result took the total number of approvals to 13,388, the third highest monthly result in over twelve months."
"It is pleasing to see approvals moving in the right direction, but the improvements are occurring from a historically low starting point. The volume of approvals in the last three months implies a rate of around 140,000 new home completions per annum, which is a low level relative to the housing requirements of Australia's population," said Geordan Murray.
"We have to start somewhere and if an upward trend in building approvals can be sustained through the remainder of 2012 then we have made that start. We do, however, need to see greater traction in the detached house market and a broader geographical recovery."
"Geographically, the improvements in September were narrowly based - only the east coast states posted improved approval numbers," said Geordan Murray. "New South Wales was the stand out performer where it seems the state government's combination of stamp duty concessions and grants may be having an effect. From a relatively low base in August, total approvals in NSW were up by 22.8 per cent in September. “
“Underpinning this result was a 48.0 per cent increase in the multi-unit segment, meanwhile approvals for detached dwellings improved by a modest 1.4 per cent," Geordan Murray said.
Despite the rise, Master Builders Australia Chief Executive Officer, Wilhelm Harnisch said the September increase in the total number of building approvals does not accurately reflect industry conditions.
"Builders continue to report that activity is low and that the outlook remains poor in the short term.
"The 7.8 per cent increase in the total number of dwelling units approved dramatically masks the ongoing sluggish housing sector recovery.
"The more telling statistic is the private sector housing figure, which only increased by 1.2 per cent. The overall figure is masked by a 17.9 per cent increase in residential apartments, which is still recovering from a 40 per cent decrease from July.
"Master Builders September quarter National Survey revealed low consumer confidence is the major factor holding back what should be a more sustained and stronger housing recovery at this stage of the housing cycle.”
"Today's figures indicate another 50 basis point interest rate cut by the Reserve Bank of Australia is warranted to underpin the fragile and fledgling signs of a housing recovery," Mr Harnisch said.
