The Australian Bureau of Statistics has released data showing the housing development activity for the past quarter beginning in June 2017.
The data details the current housing commencements, completions and constructions for last quarter’s housing sector which make some interesting conclusions.
Let’s take a look at what was in the works last quarter.
Over 28,000 new homes and 24,380 units in total for the nation had commenced construction over the June 2017 quarter. House numbers were up by around 3.3% on the previous quarter but were 7.1% down on 2016’s figures.
Unit commencements had dropped by a little under 1% with also a 6.6% reduction seen on last year’s numbers.
An interesting fact to note is that every state in the country recorded lower commencement rates for houses than the year prior with the ACT copping an almost 39% drop!
However, units recorded a few increases across some states, being New South Wales, Victoria, South Australia and Tasmania. Queensland, Western Australia, Northern Territory and ACT all saw losses.
Over 28,000 houses and 25,000 units were completed around Australia for the June quarter this year.
Given that these figures are relatively close to those of commencements, it looks as though a significant percentage of these completions would have been partially made up of those commencement numbers.
House completions saw a drop of 1.2% and new unit completions were also around 10% lower than the previous quarter.
In comparison to last year’s figures, both house and unit completions saw reductions of 9% and 5.2% respectively.
The data shows some big figures in terms of increases and decreases per state with the following numbers recorded:
- NSW, QLD and ACT had shown monumental increases for houses completed with 8.6%, 18.3% and a whopping 73.3% respectively.
- VIC, SA, WA, TAS and the NT were among the decreases for completion rates with 12.8%, 3.7%, 45.3%, 29.8% and 44.2% respectively.
- VIC, QLD and ACT saw the increases with 11.1%, 13.7% and 29.6%.
- NSW, SA, WA, TAS and NT had a decrease in completions of 20.4%, 41.6%, 22.3%, 40% and 69.9%.
By the end of the quarter, there were 216,242 dwellings around Australia amidst construction. This is still considered a significantly high number, following suit from September 2016’s all-time high figure of 224,314.
To put these numbers into perspective, the long-term average over the past 10 years works out to be 153,545 for the quarter suggesting that demand and growth is really taking over.
New South Wales, Queensland, Victoria, South Australia and Western Australia all currently have a number of dwellings under construction higher than the 10-year average.
Looking at units, NSW, VIC, QLD, SA and ACT are all showing figures well above the 10-year average with increases of 276%, 298%, 247%, 116% and 297%. Tasmania is the only state that has less unit constructions than the long-term average.
The massive increases we’re seeing in housing construction is driven by the demand for units. Although they take longer to complete, they offer a higher stock per project ratio than what building a single house does.
This demand is likely derived from the fact that people are deterred from the unaffordability of houses and opting for a unit instead.