Australia’s high-rise apartment crash turns apocalyptic

Yesterday, the Australian Bureau of Statistics (ABS) released its dwelling approvals data for November, which revealed that dwelling approvals nationally have crashed by 35% in trend terms from the March 2015 peak, driven by a mammoth 52% decline in unit and apartment approvals:

Today, I want to focus on the high-rise apartment segment, which is driving the bust and is also the subject of deep concerns around quality.

The next chart shows the picture at the national level in annual terms, which shows that high-rise apartment approvals have crashed by 53% since peaking in October 2015:

As shown above, there were 36,691 high-rise apartments approved across the nation in the year to October 2019, well down from the peak of 78,089 in the year to October 2015.

Detached house and townhouse approvals are also falling swiftly; albeit at a slower rate.

Below are the same charts at the state and territory level:

The high-rise apartment approvals crash has been driven by NSW (-57%), VIC (-57%) and QLD (-70%), which have all fallen massively from peak. ACT’s high-rise approvals have also crashed (-40%).

The below chart shows the high-rise bust across the major markets:

The crash is broad-based, nasty and ongoing. It is the smoking gun of RBA panic.

Leith van Onselen


  1. I am guessing it will be the same where Chinee speculation has driven this growth, including China of course. A proxy for hi lux economy

    • Chinese money was a determining factor for much of it. They were selling buildings 80 – 100% offshore in 2015.
      Without the Chinese pre-sales there isn’t much of a market for this gunk, hence the crash.

  2. reusachtigeMEMBER

    The government needs to invest a large amount of money to support the apartment market and to bring back its confidence!

  3. Looks like a return to normal after one hell of a binge on apartments. Maybe with less being built they’ll have time to mix the concrete properly. Maybe even read the plans occasionally.

    • There is no incentive to do a proper job when you know that if you maximize profits you are untouchable for the corners you cut.

  4. Instead of buying bonds or even mortgages, the forthcoming QE Australian style should be focused on buying high rise apartments at full price so as to ensure investors are made whole and those with cladding/structural problems can move on with their lives. I have spoken. This is the way.

  5. What’s the lag time then, there are hundreds if not thousands of cranes up in Melbourne and Sydney at the moment. When will the crane count start falling?

  6. With the population ponzi steaming ahead and residential vacancies tightening again after never reaching healthy levels >4% in most cities, a collapse in approvals is a disaster for anyone interested in permanent downward pressure on house prices and rents.

    Killing off supply serves the purposes of the asset prices fluffers and is not good news.

    • Very true. Apartment prices will boom soon, as the growing population has to find somewhere to live.

    • I tend to agree, given my experience in Ireland it didn’t stop the crash, but it also didn’t help prevent the reinflstion a few years after. If you can HODL through the down point.

    • When the jobs numbers start to rise as they have no work will be the telltale as to prices and confidence. Not only they won’t have work but no money to spend elsewhere in the economy so other sectors hit as well and the avalanche starts then…

  7. Developers I know are all laying off staff.
    I’ve never know such a disconnection to exist between high end house price action and the prospects for apartment developments.
    Something’s got to snap.