NSW building approvals slowing down: Urban Taskforce
Non-residential and residential building approvals fell over the last six months in NSW, says the Urban Taskforce citing Australian Bureau of Statistics data.
“In a worrying sign that the property market is slowing down the latest ABS approval numbers continue a fall from June 2015,” said Urban Taskforce CEO Chris Johnson.
In the high density apartment market, approvals in December 2015 dropped to 3,060 from a high of 3,338 approvals in June 2015 on trend numbers.
This could be a settling down to more normal production or point to less confidence in the market through a tightening of bank loans, said Johnson.
“While the state’s performance is well above the 10-year average the continual slow down means the government must be careful with any changes that affect the industry. We are concerned that statements about value capture levies along with a less focussed local government sector due to amalgamations could lead to further drops in production,” he said.
“Even at the June high point NSW was not producing sufficient housing for the increased population particularly when many approvals do not proceed to housing production.”
According to the NSW Department of Infrastructure and Regional Development website, land value capture or uplift involves governments levying a proportion of the increase in the unimproved capital value of private land due to public sector transport infrastructure investments.
The various forms of value capture range from property taxes, parking levies and voluntary planning agreements.
The non-residential building approvals — measured by value — have also slowed over the last six months with NSW now behind Victoria and Queensland despite these states being smaller.
Non-residential building approvals in Victoria were $833,198,000 in December 2015 compared to Queensland at $692,603,000 and NSW at $691,569,000.”
“While the NSW economy is generally in good shape the role of building production needs to be carefully supported to ensure it remains robust,” said Johnson.
He suggested that the Greater Sydney Commission take a more proactive role with approvals of major projects during the transition process to ensure housing supply continues at a strong level.
