Building approvals are improving according to RP Data’s latest research. November and December 2013 data released by the Australian Bureau of Statistics shows that for November 2013, 16,396 approvals were granted which was 22.2% higher compared to approvals in November 2012.
The interesting trend is that the unit approvals grew faster than housing approvals and the private sector drove the majority of building approvals.
The rise in unit approvals may be partly driven by their better affordability and Government initiatives to increase housing density within cities.
The data shows that Melbourne and Sydney are leading the growth and this is exactly the type of response the Reserve Bank of Australia would have wanted. The mining boom has come to an end and the RBA would be looking for some additional stimulus to the economy.
While the growth in building approvals is nowhere near enough to compensate for the mining slow down it will be interesting to see how house prices react in 2014 to this growth.
Mortgage Broker What If We Finance advises that there has been increase in construction home loans and banks are starting have more flexible credit criteria in these areas.
Contact your mortgage broker if you want more information or are this of building.