Australia's building approvals jump 8.9%m/m
The total number of building approvals was inflated by a surge in Apartments
Building approvals for the month of November bounced 8.9%m/m (JPMorgan 3.2%, consensus 0.0%), after a downwardly revised
3.6%m/m fall in October. The lion's share of the monthly increase was driven by a 30%m/m increase in the number of
apartments approved. The total number of houses approved over the month rose just 0.2%m/m. Unfortunately, the building
approvals series is notoriously volatile; and it is therefore difficult to gauge any true direction in the housing
market from month to month movements. The trend series, however, is showing clear signs of improvement (chart), after
faltering mid-way through last year. Although the trend in building approvals is likely to plateau over the next few
months - as interest rates increase, the availability of credit remains tight, and investors exercise caution - JPMorgan
expects building approvals to pick up again into year end.
Most of the jump in building approvals came out of NSW, which recorded a massive 67%m/m increase over the month. The
huge November month more than offset the 15% decline recorded in October. The NSW gain was supported by strong rebounds
in building approvals in Adelaide and Perth (up 22% and 14% respectively). The gains in Adelaide and Perth merely gave
back the declines recorded in October (-19% and -14% respectively).
ENDS