Regional Building Approvals shows QLD’s lack-lustre performance is due to the regions

Today’s release of regional building approvals data shows that the poor performance being seen in QLD (see here) is due to declines in the regions. Trend approvals across the state were up just 4.4% y/y in December but when we look at the regional breakdown (by way of the Conus Trend series) we see that Greater Brisbane recorded a y/y increase of 25.8% while the Rest of Queensland dropped 17.3%.

Looking at our own backyard we see Cairns SA4 saw a slight dip in Dec to 87 (from 88 in Nov) but approvals remain up 13.4% from the same time a year ago. In Townsville SA4 Trend approvals also dipped (to 59 from 60) but this represents a 26.3% decline for the year and now sits at a new record low.

At a Local Government Area level Cairns Regional Council (incl Douglas Shire) Trend approvals are at 58 (down from 59), although this is  39.4% higher than a year ago; Cassowary Coast Regional Council is unchanged at 7 and up 17.4% y/y; Tablelands Regional Council (incl Mareeba Shire) were unchanged at 24 and up 13.1% y/y. While in Townsville City Council area Trend approvals also fell (to 52 from 53) and are now down 22.5% from the same time a year earlier.

The full set of Conus Trend Approvals for the QLD SA4 regions is available for download below. Please feel free to use this data (for non-commercial purposes) but we would appreciate you acknowledging Conus when you do so.

Conus Trend Regional Building Apps QLD – Dec 2017

Big miss for Building Approvals nationwide but QLD does better

Today’s release of Building Approvals data was a big disappointment for the markets. Expectations had been for (seasonally adjusted) data to show approvals down about 8% m/m (+11% y/y) after a 11.7% increase in Nov. In fact the monthly decline was a thumping 20% which took the annual growth into negative territory at -5.5%. The decline came from a massive reduction in unit approvals (down 38.8% m/m) despite a modest pick up in house approvals (+1.4% m/m). This degree of volatility in the seasonally adjusted data due to the lumpiness of unit approvals is why we much prefer considering the less volatile Trend series.

Doing so shows Trend approvals fell 1.7% m/m and are up 3.3% y/y (after some downward revisions to the Nov data). Over the year Trend house approvals are up 4.4% while units have risen just 2.1%.

In QLD things looked somewhat healthier. The seasonally adjusted data showed a 4.2% m/m increase (+8.1% y/y), but the Trend series fell 0.8% m/m and is up just 4.4% y/y (after some positive revisions to Nov). Trend house approvals in QLD rose 9.3% y/y while the unit market continued to show weakness, on the back of very rapid growth in previous years, and are down 4.1% y/y.

Regional data for approvals will be released next week at which time we shall be updating our Conus Trend Regional Approvals for SA4 regions in QLD as well as for our local North QLD Council areas.

Good house approvals cannot make up for falling units in QLD

The ABS data for building approvals in October were good news at a national level with (seasonally adjusted) approvals up 0.9% m/m for a 18.4% increase year-on-year. The less volatile (and preferred, given how volatile unit approvals can make this data set!) measure showed a 0.7% m/m increase and a gain of 4.2% for the year.

In Queensland the seasonally adjusted numbers were also positive (+6.1% m/m and +3.1% y/y) although the Trend is still showing declines; down 1.8% m/m and down 2.0% y/y. When we consider the breakdown in the Sunshine State we see that while housing approvals are up a Trend 12.1% y/y it is the sharp decline in units (down 21.0% y/y) that is behind the weaker data.

Regional approvals will be released next week at which time we will be updating our Conus Trend series for all the QLD SA4 regions as well as our own local LGAs.

 

Building Approvals point to Dwelling Construction turning the corner in QLD by end of 2018

Today saw the release of the Building Activity data for the second quarter of 2017 and it shows dwellings under construction falling in QLD (in particular unit construction)…see the chart below from Stephen Gosarevski, Economist at CCIQ.

But as readers will know, the trend in residential building approvals in QLD has turned something of a corner and we have been looking at a reasonable recovery since late last year (see here for latest commentary). Not surprisingly, approvals are a leading indicator for actual construction work. As the chart below makes clear, that lead averages anything from about 7-10 months with turning points in approvals seeing similar shifts about 7 to 10 months later in dwelling construction.

Given the recovery in residential approvals started in QLD in Dec 2016, with the quarterly data turning upwards in March 2017, we can expect to see a similar recovery take hold in quarterly construction work by the final quarter of this year (assuming the recovery in approvals remains relatively intact).


Building Approvals jump in the Far North

The ABS released their (original, unadjusted) residential building approvals at the SA4 and LGA level this morning; and they reveal good news for the Far North. As always, this highly volatile data set needs to be seen through the lens of the Conus Trend to make any real sense of it.

When we consider the data at the SA4 level we see the original data for Cairns up at a more-than-9-year high. However, even when looking at the Conus Trend we see a significantly improved story. Trend approvals increase to 107 in August after July was revised sharply higher to 103. Trend residential approvals are now up 15.9% y/y; the best result since March 2015.

Unfortunately, to our south in the Townsville SA4 region things are not as rosy. Here Trend approvals fell in August to 75 after July was revised slightly lower to 77. Year-on-year Trend approvals are down 7.4%.

As the second chart below makes clear. the recent recovery in approvals across the state is coming largely from Greater Brisbane with the Rest of Queensland still lagging well behind.

We can also consider the Conus Trend data for the LGAs within the Cairns SA4 region and here we see that the improvements have been seen in Cairns Regional, Cassowary Coast Regional and Tablelands Regional Council areas. Cairns Regional Council Conus Trend approvals (incl Douglas Shire) rose to 77 in August after July was revised strongly higher to 76; year-on-year this represents a 30.3% increase. In the Cassowary Coast Regional Council (where the original data saw a higher number of approvals than in any month since June 2005) the Trend rose to 9 which is a 44.8% y/y increase. On the Tablelands (Tablelands Regional plus Mareeba Shire Councils) Trend approvals also rose to 21 after July was revised stronger; however approvals remain down 6.4% from a year ago.

In the Townsville City Council area Trend approvals fell to 69 after July was revised lower to 71; they are now down 5.5% from a year ago.

The full set of Conus Trend Residential Building Approvals for all the SA4 regions in Queensland is available for download below. Please feel free to use this data (for non-commercial purposes) but we would appreciate you acknowledging Conus when you do.

Conus Trend Regional Building Approvals QLD – Aug 2017

QLD Building Approvals grinding higher despite unit falls

The ABS data for residential building approvals for August shows that across the country approvals were up 0.4% m/m (seasonally adjusted) but remain down 15.4% y/y. The far less volatile Trend series shows approvals up 1.1% m/m and down 6.5% y/y (which is the slowest rate of decline this year).

In Queensland things look similar. Total approvals rose 13.2% m/m (seasonally adjusted) but remain down 9.6% y/y. The large monthly gain was driven by a 25.5% jump in unit approvals. The preferred Trend measure shows that over the course of the month approvals rose 1.0% with house approvals up 1.7% and units down 0.1%. For the year the Trend confirms that it’s house approvals that are driving the recovery in QLD; they are up 9.1% while unit approvals are down 21.4%.

Regional data will be released next Tuesday when we shall update our Conus Trend Approvals series for all QLD SA4 regions and the FNQ Local Councils.

 

Regional Building Approvals; no joy for the North

The release of the regional building approvals data by the ABS today allows us to update our Conus Trend series for the SA4 and Local Govt Areas.

What we find is a story of slightly weaker, but generally stable, approvals in the North. The Cairns SA4 region sees Trend approvals stable at 77 after June was revised down from 80. Townsville SA4 falls slightly to 79 after June was revised up from 78 to 80. The picture at the LGA level is similar.

Cairns Regional Council (incl. Douglas Shire) fell to 53 after June was revised down from 56 to 54. Cassowary Coast Regional Council was stable at 6 after June was revised up from 5, Tablelands Regional Council (incl Mareeba Shire) was stable at 18 and Townsville City Council was also stable at 72, although June was revised up from 68.

The full Conus Trend data set is available for download below. Please feel free to use this data (for non-commercial use) but we would appreciate yoy acknowledging Conus when you do so.

Conus Trend Regional Building Approvals QLD – Jul 2017

No sign of improvement in Far North Building Approvals

This morning we saw the release of the ABS original regional building approvals data for June. As always, we need to consider this volatile series in light of the Conus Trend to make much sense of it.

In the SA4 regions of Cairns and Townsville there was little to get excited about. The Conus Trend for residential approvals in Cairns in June rose slightly to 81, but only after May was revised down from 86 to 80. In Townsville the Conus Trend remained stable at 79, although May was revised down from 86.

As we noted last week (see here), the tide for approvals appears to have turned somewhat in Queensland in recent months but analysis of the Conus Trend data shows us that the improvement is all coming in Greater Brisbane with the Rest of Queensland stable at best. In the past 6 months Trend approvals in Greater Brisbane are up 28% to 2,055 while in the Rest of Queensland they have fallen 4% to 1,486.

Within the Greater Brisbane area hot-spots in the past 6 months have been Brisbane-West (+82%), Brisbane-Inner City (+118%), Moreton Bay-North (+34%) and Moreton Bay-South (+45%).

Looking at the Local Government Areas in the Far North we see the Cairns Regional Council (incl Douglas Shire) area Trend at 57 (unchanged from an upwardly revised May); Cassowary Coast Regional Council Trend stable at 5 (after May was revised down from 6); Tablelands Regional Council (incl Mareeba Shire) Trend unchanged at 18. To our south Townsville City Council Trend came in at 69 (down from 71 in May which was itself revised down from 75).

The full set of Conus Trend data for the SA4 areas in QLD is available for download below. Please feel free to use this data (for non-commercial purposes) but we appreciate you acknowledging Conus when you do so.

Conus Trend Building Approvals QLD – June 2017

 

Building Approvals data shows the tide is turning in QLD

Today’s ABS data on residential building approvals in June confirms the slow turnaround in the sector in Queensland. For the 6th consecutive month we see Trend approvals up for the month and the year-on-year decline now at its slowest rate since Sept 2016.

On the Trend basis total approvals in QLD were up 1.1% m/m for a decline of 14.7% y/y. The growth is coming from houses (up 2.2% m/m) while unit approvals remain largely stable (down 0.5% m/m).

Across the nation approvals were up just 0.1% m/m and remain down 14.9% from a year ago.

Regional Building Approvals data shows some improvement in the North

The ABS released their regional (unadjusted) building approvals data this morning for May; we have constructed our own Conus Trend data and they show some improvement across the North.

When we consider the data at the SA4 level we see that the Conus Trend has Cairns approvals up to 86 (after April was revised up to 84) and Townsville also up to 87 (again, April was revised higher to 85).

Across the state as a whole Trend approvals were up in Greater Brisbane, although they remain down 18.2% for the year, at 1,958. In the Rest of Queensland the Trend dipped to 1,563 and is down 14.8% for the year. Commentary on the QLD data released last week is here where we note that QLD generally did better in May; clearly that was due to improvements in Greater Brisbane rather than the regions.. 

In our own region we also see some small improvements across the Local Government Areas. The Cairns Regional Council (incl Douglas Shire) see Trend approvals edge higher to 53 (after April was revised up from 43). The Cassowary Coast Regional Council now sits at 6 (after April was revised up from 5) while the Tablelands Regional Council (incl Mareeba Shire) are now at 18 (after April was revised up from 17). To our South Townsville continues to see improvements with Trend approvals in May at 75 after April was revised up from 73.

The complete set of Conus Trends for the SA4 Regions in QLD is available for download below. Feel free to use this data (for non-commercial purposes) but we would appreciate you acknowledging Conus when you do so.

Conus Trend Regional Building Approvals QLD – May 2017