Australian building approvals have fallen sharply in June.
Approvals dropped by 8.2%, the largest percentage decline since September 2014, with the figure well below expectations for a decrease of 0.8%. The 2.4% increase reported for May was also revised lower to 2.3%.
Despite the monthly decline total approvals increased by 8.6% from June 2014.
A sharp decline in dwelling approvals ex-houses, down 19.5% to 8,105, overshadowed an increase in house approvals which jumped by 4.0% to 9,763.
Over the past year total house approvals numbered 116,086, an increase of 6.1%. Approvals excluding houses rose by 21.5% to 104,337, the highest level on record. The huge increase in the latter is largely due to the rapid growth in high-rise unit approvals, predominantly in the Eastern states.
While high-rise apartment approvals have surged in recent years, as demonstrated by the chart below, that was not the case in June. In original terms the number of residential approvals for units in structures four stories or slumped by 3,588, or 48.4%.
The decline, the largest in percentage and numeric terms since September 2012, entirely explains the weakness seen in the headline approvals figure.
Although a sudden drop, the category is highly-volatile and increasingly influential on the total level of building approvals. Indeed, even with the huge decline reported in June, total approvals for high-rise units in the past year increased to 63,771, the highest level on record.