The release on Wednesday of the March quarter dwelling commencements and completions data (analysed here and here) has enabled me to update charts tracking quarterly approvals, commencements, and completions against Australia’s population growth, which provides an indication of the extent to which housing construction is currently lacking.
First, the below chart shows the situation at the national level:
As you can see, overall dwelling construction has failed to respond to the big surge in population since the mid-2000s, or the massive rise in home prices since the mid-1990s.
Next is New South Wales, where dwelling construction remains highly depressed, both in an absolute sense and relative to population growth, portending possible housing shortages:
Victoria, by contrast, has experienced a delayed supply-response, which suggests a possible glut of apartments and homes in outer suburban estates:
A bit like New South Wales (but less extreme), dwelling construction in Queensland has weakened as population growth has picked-up:
In Western Australia, population has surged since 2003 in response to the mining boom, but there has been next to no pick-up in dwelling construction:
Finally, South Australia has experienced a solid but less spectacular pick-up in population growth, which also appears not to have been matched by an increase in construction, which is tracking at levels consistent with the 1980s:
Overall, the data supports the view that the rate of dwelling construction across Australia has weakened. This notion is supported by other measures, such as the number of homes built per 1000 head of population, which shows overall construction rates declining since the mid-1990s, driven by big falls in detached house construction:
