The latest ABS data on shows that approvals of both new detached dwellings and units further declined in October. Total number of new dwellings approved measured approximately 4,670, around 700 or 13 per cent fewer than those approved in September 2016. Compared with the same period last year, total approvals were down by nearly 2,600 or close to 36 per cent. This marks the second consecutive month in which both sectors recorded net approvals decline in 2016 and is reflective of the concern over the state of supply over the short term.

The drop in approvals of new units further declined in October. Only 1,731 units or apartments were given the go-ahead, down by 519 on September and 2,378 on October 2015. Similar to decline in the previous month, the decline recorded in October was due to the continued drop in approvals granted to larger apartment projects of four storeys or more, which recorded only 430 in October, down by more than 860 on last month or some 2,270 on October 2015. The significant decline in approvals over the recent months is reflective of the high volatility in this particular segment of the market, as shown in the chart above.

Meanwhile, new houses approvals continued to moderate in October. The total number of new houses approved recorded approximately 2,935, having declined by around 6 per cent on September 2016, or close to 7 per cent compared to a year earlier. There have now been 30,654 detached house approvals in 2016 so far – up by 6 per cent on the first ten months of 2015, indicating that this market remained healthy. New house approvals are most likely to continue to decline in the following months due to the annual holiday season.