Over 6.5k homes get the nod
The home construction industry will have its hands full for some time yet.
A total of 6519 new homes applications were approved across Victoria during August, up by almost 11 per cent on the previous month and significantly 25.5 per cent higher than the same month last year.
Master Builders Victoria CEO Rebecca Casson said that the increase surpassed the national average of 6.8 per cent, which demonstrated the strong resilience in the state’s economy despite recent lockdowns.
“Approvals for both detached houses and for medium/high density homes rose during August,” Ms Casson said.
“However, growth on the medium/high density side was stronger than for detached houses.”
Ms Casson said that previously multi-units have not fared as well as detached housing over the course of the pandemic and in 2020, approvals sank to their lowest level in almost a decade.
“A rocky recovery has since taken hold, but restrictions on international and state borders combined with changes in market preferences for larger living spaces has resulted in multi-unit dwellings only accounting for 30 per cent of total building approvals in Victoria in the last year,” Ms Casson said.
“This is significantly lower than the long-term average over the last decade.”
Approvals for new detached houses peaked in the month of April this year, coinciding with the end of the Homebuilder grant in the middle of the same month.
Ms Casson said that major home renovations activity has not benefitted as strongly from Homebuilder.
“Home renovations activity may have been cyclical in nature over the last five years but the effects of prolonged lockdowns and inability to work in occupied homes has resulted in a significant decline in approvals,” she said.
“Conversely, the value of work approved for major renovations work has increased over the same period.
“Victoria’s average renovation approvals were $124,700, higher than the Australian average of $101,100 during the three months to August 2021.”
Of the renovation jobs approved in the Homebuilder-eligible price bracket between $150,000 and $750,000, the national average was $299,900.
Victoria had the highest average renovation in this price bracket ($313,300) followed by New South Wales ($304,700) and Queensland ($301,500).
Ms Casson said that while their industry is currently seeing less approvals for renovation works, the value of renovation work itself has gone up, which may balance out market outcomes.
“The resilience of our industry is also represented in employment terms.
“As of August 2021 quarter, the building and construction industry generated approximately 323,800 full-time and part-time jobs, an increase of 9.2 per cent from August last year.
“The industry is now Victoria’s largest employer of full-time employees, providing 11.9 per cent of fulltime job opportunities for the state.
“The Victorian economy has demonstrated resilience despite our ongoing lockdowns and our industry remains a key player in our economic recovery.”