The latest building approvals data for Victoria has been released, showing an overall decline in approvals, with apartments/units driving the condition. The decline reflects a weaker housing building sector caused by falling house prices, the royal commission into banking, and the uncertainty of the status of housing policy after the coming election in May.

Key highlights

• Total monthly and quarterly building approvals for December 2018 fell by 8.1 per cent and 1.3 per cent respectively, with apartments/units driving this fall.
• Apartment/unit approvals fell by 24.2 per cent for the month of December and 7.1 per cent for the December quarter.
• Building approvals in Victoria for 2018 totalled 15,903 – 3 per cent less compared to 2017. Total apartment/unit approvals fell by 14.4 per cent compared to 2017; however approvals for houses saw a total increase of 7.2 per cent from 2017.

December 2018 saw a total of 4,664 building approvals which translates to a quarterly total of 15,698 building approvals. This marks a monthly decrease of 8.1 per cent and a quarterly decrease of 1.3 per cent. Apartments have been the main driver for the monthly and quarterly decline, in which it saw a monthly decline of 24.2 per cent and a quarterly decline of 7.1 per cent.

Despite the overall decline in building approvals, houses remain positive, with 3,225 approvals for the month of December (+1.5 per cent) and 9,800 for the December quarter (+2.6 per cent).

The total number of building approvals for Victoria in 2018 was 15,903 – 3 per cent less compared to 2017 with the decline driven by the fall in apartments and units (-14.4 per cent). Nevertheless, against this backdrop of falling apartment/unit approvals, total house approvals grew in 2018 (+7.2 per cent).