Earlier today we learnt that Australian residential building approvals over the past 12-months hit yet another record high. 215,415 dwellings were approved, surpassing the previous record of 213,084 struck only a month earlier. The growth has been phenomenal, rising 13.1% in the past year alone.
The acceleration in approvals has largely been driven by surging unit approvals, particularly for high rise apartments, particularly along Australia’s eastern seaboard.
As the chart below shows, residential apartment approvals in complexes four stories or more in New South Wales, Victoria and Queensland have exploded in recent years.
Over the past year approvals surged to 56,082, making up approximately 56.3% of total residential approvals. The figure was 31.3% higher than May 2014 and, going back a year further, an increase of an eye-watering 101%.
While these are for approvals – not actual starts – should the majority make it to the construction stage, it will not only increase the supply of available housing stock but also raise concerns over a possible high-rise glut.