Australian dwelling approvals moved lower in August, as they fell by 9.4% in the month, well below expectations (market median +1.0% and Westpac -2.5%), to be 13.6% below a year ago.
Key Quotes
“This comes on the back of a 4.6% decline in July, revised up a little from -5.2%.”
“The August result lends support to the Westpac view of a second leg lower in dwelling approvals – although we note the volatility of this data, month to month.”
“We expect high rise approvals to weaken, noting a sharp drop in site purchases in 2017. Investors, foreign buyers and developers are pulling back at this late stage of the cycle and with lending conditions tightening.”
“This contrasts to the first half of 2018, when new home building activity advanced, increasing by 3.2% in Q1 and rising by a further 3.6% in Q2. Total housing activity, including renovations, directly added 0.3ppts to overall economic activity over the first half of 2018.”
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