Aus Housing Market Down For June

The housing industry in Australia has experienced a huge setback as building approvals for the month of June have fallen sharply.

In the national scope, building approvals declined to 6.9%, while construction projects have also fallen to 13% compared to last year’s numbers. This is the second consecutive month with the numbers are down, according to analysts.

Building approvals in Victoria have also fallen to 24.3%, and analysts are qualifying this as the worst performance in the industry. South Australia’s number is down by 9.6%, while Western Australia is at 0.4%. Queensland and New South Wales, however, posted good numbers, with a rise to 7% and 6.7% respectively.

Analysts have previously speculated that there should be a rise in building approvals by June, following cash interest rate cuts by the Reserve Bank of Australia (RBA) to its lowest at 2.75% last May.

With the latest results, however, members of the Housing Industry Association (HIA) had been disappointed, particularly when the housing market seemed to have shown signs of improvement. One member said these new numbers show how “housing activity in general is really quite vulnerable at the moment.”

A member added, “We had reason to believe over the last six or nine months there was a bit of recovery under way in building, but these figures would put a question mark over that again.”

The HIA is pushing for another interest rate cut by the RBA in order to recover. “The succession of interest rate cuts have had an important role in getting housing activity back up off the floor to a certain degree.”