Not Commenced

Today our chart shows the number of dwellings approved, but not yet started.

It is one of those rare property charts where, if the lines go down, it is a good thing.

At present, some 9,500 detached houses have been approved but haven’t yet commenced construction.  This is about a ten percent of last year’s detached house approvals.

But it is the attached dwelling figures that remain alarming, with about 32,000 apartments/townhouses approved, but still waiting in the wings.

When breaking it down the supply of approved but unbuilt dwellings is spread out as follows.  Both tables are for the year ending March 2018.

Detached houses

State

or territory

Number

yet commenced

Spread of

unbuilt stock

% of last

year’s approvals

New South Wales 3,759 39% 13%
Victoria 1,480 16% 4%
Queensland 1,381 14% 5%
South Australia 1,738 18% 21%
Western Australia 823 9% 6%
Tasmania 270 3% 13%
Northern Territory 43 0% 8%
ACT 42 0% 4%
Australia 9,536 100% 8%

Attached dwellings

State

or territory

Number

yet commenced

Spread of

unbuilt stock

% of last

year’s approvals

New South Wales 17,455 55% 42%
Victoria 5,806 18% 17%
Queensland 4,574 14% 26%
South Australia 1,655 5% 41%
Western Australia 1,164 4% 24%
Tasmania 98 0% 20%
Northern Territory 108 0% 84%
ACT 799 3% 20%
Australia 31,659 100% 29%

Some comments

Despite the recent surge in population growth, there now appears to be an oversupply of new housing construction.

In addition, there is a mismatch between the type of new dwellings being delivered and what the local market really wants.

Many new residential projects are no longer viable.

Some are saying that the lack of housing starts is due to a shortage of skilled construction staff.  Maybe?  But according to the bureau of statistics, 140,000 construction jobs were created over the three years, but construction jobs declined by 20,000 over the three months alone.

In short, new housing construction is now well passed its market peak.

Until next time,

Michael Matusik

…..

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