Australia: Oct dwelling approvals up 0.9% - Westpac

Matthew Hassan, Research Analyst at Westpac, notes that Australia’s Oct dwelling approvals were up 0.9% as surprise jump in Vic offsets sharp falls in other states.

Key Quotes

“Dwelling approvals again surprised to the upside in Oct, posting a 0.9% rise against expectations of a 1% decline.”

“The detail shows a very sharp rise in Vic approvals, up 24.3% in the month, more than offset a significant fall across the rest of Aus (down 8.3%mth on a combined basis).
The Vic gain was led by a jump in high rise approvals that likely reflects a lumpy project pipeline.”

“Although detached house approvals also posted a strong increase in Vic, the high rise increase is likely to unwind raising the risk of a sharp correction lower in approvals in coming months.”

“Overall, private detached house approvals rose 1.5%, the aforementioned rise in Vic and a solid 3.2% gain in Qld more than offsetting declines in NSW (–5.2%), SA (–3.7%) and WA (–1.9%).”

“Despite the Vic jump, total unit approvals were down 1%mth nationally with sizeable pull backs in NSW (from a jump in Oct) and WA.”

“The value of renovation approvals also rose strongly in the month to be up close to 15%yr.
The value of non res building approvals posted a modest pull back in Oct but is still up over 30%yr.”