Australian Bureau of Statistics (ABS) building approvals data for the quarter ending December 2019 further highlights signs of improvement in the Victorian housing sector, especially in the high-density market which saw a significant rebound in approvals. This kind of improvement is indicative of the effect the Australian Prudential Regulation Authority (APRA)’s easing of credit conditions, and the Reserve Bank of Australia (RBA)’s series of cuts to the cash rate have had on industry and consumer confidence.
Victoria saw a quarterly increase of 26.7 per cent in total dwelling approvals, with new house approvals increasing by 2.1 per cent and, more significantly, 78 per cent for apartments/units. The uptick in apartments/units is due largely to the sector’s surge in the month of December in which it saw 3393 apartments/units approved.
Indeed, Victoria’s strong building approvals performance coincides with the notable improvement in its house prices. According to CoreLogic’s national home value index, the city of Melbourne saw a quarterly increase of 4.9 per cent in dwelling values in January 2020, resulting in an annual price increase of 8.2 per cent – the largest increase among the capital cities.