(Australian Associated Press)
The number of homes approved for construction is staying near record levels, despite month to month volatility.
Approvals for the construction of new homes fell 6.9 per cent in August, after a 7.9 per cent rise in July, and another 6.9 per cent fall in June, official figures show.
So far this year, every monthly gain in building approvals has been followed by a fall in the following month, and vice versa.
Over the 12 months to August, building approvals were up 5.1 per cent, the Australian Bureau of Statistics said on Wednesday.
JP Morgan economist Tom Kennedy said the volatile high rise apartments category is driving the up and down nature of the data.
“It’s had a very strong run-up and these things can’t go on forever, so I would expect it to start dissipating from the fourth quarter this year,” he said.
Mr Kennedy said he is not worried about a sustained fall in building approvals because they are at such elevated levels they can afford to drop.
“I still think residential construction is going to remain pretty solid for some time, but it’s going to cool a little bit,” he said.
“We have recently pushed all time highs in both components, so the path of least resistance is some sort of normalisation from here.”
Approvals for private sector houses rose 4.9 per cent in the month, and the ‘other dwellings’ category, which includes apartment blocks and townhouses, was down 11.4 per cent.