Building approvals for houses climb for sixth month in a row

Aerial shot of houses in Australia.

Building approvals for private houses climbed 15.8 per cent in December 2020, marking the sixth straight month of growth according to the the Australian Bureau of Statistics.

Approvals for detached housing were highest in South Australia (33.6 per cent), followed by Victoria (17.2 per cent), New South Wales (16.2 per cent) and Queensland (7.5 per cent).

New South Wales posted its highest private house approval figure since March 2000. Queensland also experienced a surge, recording its highest approval numbers since September 1994.

Overall, the total number of dwellings approved in December increased by 10.9 per cent in seasonally adjusted terms.

Daniel Rossi, director of construction statistics at the ABS said current interest rate settings and a host of government programs have played a major part in supporting ongoing growth.

"Despite the uncertainty experienced by developers and households during 2020, the total number of dwellings approved in the calendar year was 4.8 per cent higher than in 2019," he said.

“Federal and state housing stimulus measures, along with record low interest rates have contributed to strong demand for detached dwellings.”

Housing Industry Association economist, Angela Lillicrap said the result was “exceptional” considering how much other sectors of the economy had been rattled by the coronavirus pandemic.

“The surge in the number of building approvals has continued each month since the announcement of HomeBuilder in June,” she said.

“This volume of work will ensure ongoing employment growth in the sector through 2021.”

RELATED: Property market sentiment continues to rise, finds ME Bank


She also noted that data for building approvals typically lags behind other leading indicators such as new home sales and housing finance data, both of which set records for growth in December.

“With this in mind, it is likely that we have not yet seen the peak of detached home building approvals,” she said.

While approvals for private houses increased by 15.8 per cent over the month, other types of dwellings saw only meagre growth of 2.3 per cent. In particular, apartments are expected to struggle for the foreseeable future.

“Not only does the apartment market face headwinds from a lack of population growth and a preference for detached houses, yesterday’s regional migration data shows a shift away from metropolitan Sydney and Melbourne,” said Lillicrap.

“The apartment market is also likely to be constrained until overseas migration returns.”

For information about mortgage and lending trends, visit our home loan statistics page. And for an idea of where interest rates currently sit, check out our home loan comparison page, or browse the selection below.

Mozo may receive payment if you click the products below. We don’t compare the entire market, but you can search our database of 473 home loans.
Last updated 15 June 2024 Important disclosures and comparison rate warning*
  • Basic Home Loan

    Fixed, Owner Occupier, Principal & Interest, LVR<70%

    interest rate
    comparison rate
    Initial monthly repayment
    6.25% p.a.
    fixed 3 years
    6.20% p.a.

    No upfront or ongoing fees. Free extra repayments and redraw facility. Option to earn Qantas points. Min 30% deposit required. Borrow up to $750,000.

    Compare
    Details
  • Variable Home Loan 90

    Principal and Interest, LVR <90%

    interest rate
    comparison rate
    Initial monthly repayment
    6.04% p.a. variable
    6.06% p.a.

    Affordable home loan rate for buyers or refinancers. No monthly or ongoing fees. Option to add an offset for 0.10%. Access to savings with unlimited redraws available. Minimum 10% deposit required.

    Compare
    Details
  • The Better Home Loan Special Offer

    Owner Occupier, Principal & Interest, LVR<80%

    interest rate
    comparison rate
    Initial monthly repayment
    6.14% p.a. variable
    6.14% p.a.

    Enjoy a variable rate home loan with a bunch of features from Police Credit Union. Make extra repayments at any time without penalty. No monthly, annual or upfront fees. Free online redraw. Minimum 20% deposit. Qualifying criteria applies. Minimum loan amount is 200K. For new customers only. Mozo Experts Choice Home Lender Credit Union of the Year 2023.

    Compare
    Details
  • Discount Variable Home Loan

    Owner Occupier, LVR<70%

    interest rate
    comparison rate
    Initial monthly repayment
    5.99% p.a. variable
    6.01% p.a.

    A low rate home loan for owner-occupiers packed with great features including unlimited extra repayments, free online redraw, no application or monthly admin fees. Rate will vary depending on LVR. Winner of a Mozo Experts Choice 2024 Low Cost Home Loan Award^

    Compare
    Details

* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

^See information about the Mozo Experts Choice Home Loan Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.