Dwelling Approval

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<p>The ABS reported that Building Approvals remained resolutely strong in August 2016, with some 20,788 private sector dwellings approved, driven yet by another rebound in attached dwellings.</p>
<p>The trend in detached house approvals has declined by about 5 percent since peaking in April 2015, while attached dwellings have just kept on trucking. </p>
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<div>Over the year to August some 238,204 dwellings were approved, with the annual total levitating above 200,000 for 23 months on the bounce since October 2014. </div>
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<div>Commentators have been calling for an end to the boom for, well, basically all of that time, but those pesky numbers just won't sit down. </div>
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<br><img src="/images/2016/10/07/A4.jpg" alt=""><br><br><div><strong><span style="text-decoration: underline;">City by city (moar apartments!)</span></strong></div>
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<div>Perth and Darwin continue to adjust to their respectively slowing markets, with house approvals accordingly in a steep decline. </div>
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<div>Melbourne remains the city with the strongest trend in house approvals, which may be just as well given the awesomely strong population growth in that city.</div>
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<br><div class="separator">Sydney has seen a number of monumental projects put forward for consideration over the past year, including a 10-tower monster being proposed for the site of the present Fish Markets, opposite the old Wentworth Park Dogs.</div>
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<div class="separator">It's never entirely clear specifically which projects the ABS approvals figures relate to, but Sydney has approved an all-comers record 11,838 attached dwellings in only three months (wow-wee!). </div>
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<div class="separator">Records are being zinged all over the shop here.</div>
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<div class="separator"><strong><span style="text-decoration: underline;">High rise kaboom</span></strong></div>
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<div class="separator">It's no particular surprise to note that the rebound has been driven by high-density apartment projects of four or more storeys - a high proportion of these will be sold to mainland Chinese - with approvals for most other dwelling types in a steady decline.</div>
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<br><div>While Victoria may have seen a number of high-rise projects pulled forward into FY2015/16 due to planning changes, New South Wales is rubber-stamping projects for fun right now (although whether all of these approvals come to fruition is another thing).</div>
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<br><div><strong><span style="text-decoration: underline;">The wrap</span></strong></div>
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<div>The approvals figures have elicited quite a lot of excitement, although the completions delivered to date have been far less arousing.</div>
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<div>The Housing Monitor reported that Sydney saw a total of 30,191 houses and apartments completed during 2015/16, which was the strongest result since 1999/2000 (which if anything just underscores how long it has been since Sydney constructed a decent number of dwellings). </div>
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<div>This sounds quite impressive until you compare it to the hugely strong population growth of the Greater Sydney region over the same time period. </div>
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<div>Unsurprisingly, the impact on price growth was precisely zip, with dwelling prices rising by about 10 per cent. </div>
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<div>However, the key characteristic of this construction cycle is the lag - and apartment completions will increase further in 2016/17. In fact, a lot further. </div>
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<div>The figures clearly continue to show that the delivery of this glut of high-rise projects is the most at-risk sector of the market.</div>
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<p><span><em>PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>.</em><br></span></p>
<p><em>His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.</em></p>
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Dwelling Approval

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