Australian Building approvals for August

-6.9% m/m

  • expected -2.0%
  • prior was +7.9%, revised from +4.2%

+5.1% y/y

  • expected +7.4%
  • prior was +17.9%, revised from+13.4%

Note the higher revisions to July's data - a positive

The trend measure continues to decline

the drop in building approvals led by multi-unit developments


Westpac commentary:

  • Approvals came in weaker than expected
  • Fall in units dragging total approvals down ... There does appear to be an underlying downtrend emerging in this segment but the extreme choppiness - centred on high rise approvals - makes it unclear how rapid the decline is
  • Decline comes off a slightly better base though with the July estimate revised up
  • Volatility continues to cloud the situation in terms of underlying trends, even outside the noisy 'high rise' component
  • In contrast, private sector house approvals surged ... a relatively big move for what is usually a more stable segment
  • The detail suggests the 'high rise' boom in Vic has ended (noting that there was a likely pull forward in approvals ahead of a new levy in July) but is holding up in NSW where non-high rise approvals are showing a renewed rise.
  • The value of renovation and non residential approvals was both down sharply in the August month.