Has the Building Approvals decline run its course in Queensland?

Posted on July 3, 2019 by Pete Faulkner - Building Approvals, QLD, Uncategorized

The May Building Approvals data from the ABS this morning suggests that we might have seen the bottom of the downturn in Queensland…although 2 months hardly a summer makes!

Across Australia approvals were up 0.7% m/m (s.a.), or a 10.0% decline for the year. However, given the highly volatile nature of this data set (it can be easily distorted by every lumpy unit approvals) we always prefer focussing our attention on the Trend data. Here we see a 0.5% m/m fall and a decline of 29.4% for the year. House approvals are down 17.0% for the year while units are down 25.6%.

In Queensland, where the scale of the decline has been more extreme, the data suggests that we may have finally seen the bottom of this downturn. May approvals were up 0.4% m/m (this is the second consecutive month of improvements) for a decline of 29.4% for the year. House approvals are down 22.8% y/y while units have fallen 39.8% y/y.

Next week will see the ABS release the regional approvals data at which time we will update our Conus Regional Building Approvals Trend series.