Australian dwelling starts collapse

The ABS has released dwelling construction data for the September quarter, which recorded further widespread falls in construction activity.

According to the ABS, the number of dwelling commencements crashed by a seasonally-adjusted 11.7% over the September quarter, and by 27.2% over the year. Detached house commencements fell by 4.8% over the quarter and by 16.8% over the year, whereas unit commencements fell by 21.9% over the quarter and by 40.0% over the year:

As shown in the next chart, annual house commencements ran at long-term average levels in the September quarter, whereas apartment commencements continue to run above average levels despite crashing over the past year or so:

At the state level, the commencements have fallen heavily across all mainland jurisdictions:

Actual dwelling completions (which lag commencements) slumped by a seasonally-adjusted 6.0% over the September quarter and crashed by 15.3% over the year. Detached house commencements fell by 6.7% over the quarter and by 22.0% over the year, whereas unit commencements fell by 5.1% over the quarter and by 5.9% over the year:

As shown in the next chart, annual house completions ran moderately above the long-term average in the September quarter, whereas apartment commencements continue to run strong despite crashing over the past year:

At the state level, completions are down from their peak across all major jurisdictions, but obviously not as much as commencements (reflecting lag effects):

With the dwelling construction bust worsening, surely it is only a matter of time before construction employment falls from current record highs:

Leith van Onselen
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