Australia moving from reliance on mining sector to housing sector

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According to Australian Bureau of Statistics (ABS) data, throughout 2013 there were 177,418 residential dwelling approvals, which was the greatest number of approvals since January 2011.

98% of all dwelling approvals were to the private sector, with the public sector playing very little part in the construction of new homes.

Although I am not sure if NRAS Properties which attract Government subsidies were taken into consideration with these figures, which they really should have been, as they have shown to be very popular with local investors.

Housing construction is one of the key economic factors that policy makers monitor to help them gauge the economic transition away from mega-infrastructure projects related to the resource sector which is obviously winding down.

The rebound in activity across Australia’s property market is having a flow on effect to other industry sectors which is a very positive sign and greatly welcomed.

Additionally, housing construction provides a significant multiplier effect on the Australian economy, by providing more jobs and demand for building materials, home furnishings, appliances and white goods.

More approvals were granted for units at 77,909 approvals which was an increase of 23.4% over the year, this was the greatest number of annual unit approvals on record and as a result, units also accounted for a record high 43.9% of all dwelling approvals throughout 2013.

There were 99,508 house approvals which was an increase of 10.4% over the year and which was the greatest annual increase since October 2010.

Placing the heightened level of unit approvals into perspective, 10 years ago 32.6% of all approvals were for units whereas 20 years ago, they accounted for 30.0% of approvals.

Obviously this signals a move towards higher density development and this is particularly the case within capital cities.

While 43.9% of national dwelling approvals were for units in 2013, across the combined capital cities the figure was recorded at 52.3%.

Brisbane and surrounding regions are certainly showing strong growth with (57.5%) and the results show that more than 50% of approvals have been for units since early 2003.

Overall the ABS results are encouraging and highlight that dwelling approvals are increasing. Based on the trend, it looks as if the housing pipeline is set to continue growing.

However the demand for housing is growing fast as families in general want the space and privacy of their own yard and the benefits that come with owning free hold land without the pain of body corporate fees.