APARTMENT BUILDING APPROVALS ON THE RISE AS SECTOR POWERS INTO 2023 | Kanebridge News
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APARTMENT BUILDING APPROVALS ON THE RISE AS SECTOR POWERS INTO 2023

Individual borrowers may be feeling the heat in Australia but the multi-res market is shaping up for a busy year

By KANEBRIDGE NEWS
Thu, Feb 2, 2023 12:32pmGrey Clock 2 min

Approvals for apartment construction are responsible for an 18.5 percent increase in the total number of dwellings getting the green light during December, the Australian Bureau of Statistics reports.

In data released today, the figures are in contrast to the previous month where building approvals declined by 8.8 percent over November 2022.

“The increase in the total number of dwellings approved in December was led by a sharp rise in approvals for private sector dwellings excluding houses (+56.6 per cent),” said Daniel Rossi, ABS head of construction statistics. “The result was driven by a number of large apartment developments approved in New South Wales and Victoria.

“Approvals for private sector houses continued to track downwards, falling by 2.3 per cent.”

Private sector dwellings excluding houses includes semi detached, row or terrace houses, townhouses and apartments.

New South Wales saw the strongest increase, up 48.4 percent, followed by Victoria (up 20.7 percent), Queensland (up 8.3 percent) and Western Australia (up 6.4 percent). Tasmania and South Australia both recorded significant decreases, with overall approvals falling -49.7 percent and -24.6 percent respectively.

The strong performance in the apartment sector compared with private sector housing points to growing pressure on individual mortgage holders following a 3 percent rise in interest rates over 2022. The results for private sector housing were mixed, with some states recording rises, such as Western Australia (up 8.2 percent), Victoria (up 0.3 percent) and Queensland (up 0.2 percent) while others such as South Australia and New South Wales experiencing a drop, with approvals down -7.4 percent and -4.2 percent respectively. 

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In signs that confidence is returning to the Australian property market, the combined capitals recorded their highest preliminary clearance rates since April last year, CoreLogic reports.

More than 2,290 homes went to market across capital cities last weekend with early data revealing a 71 percent clearance rate. This compares with a revised clearance rate of 64.2 percent last week. It marks the second busiest auction week to date this year.

Melbourne led the way, with 1,122 homes taken to auction. Of the 916 results collected so far, 73.5 percent were successful. It was a similar story in Sydney, with 791 homes to go under the hammer. Preliminary results indicate a clearance rate of 71.5 percent.

The smaller capitals including Brisbane, Adelaide and Canberra all experienced higher clearance rates week on week, with Adelaide out in front at 78.6 percent. It was a less spectacular result in Canberra, with a 59 percent clearance rate and in Brisbane at 56 percent.

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