ABS data from May showed a monthly decline in approvals for new detached housing of 10.4%, but continually low-interest rates and buyer sentiment will allow the detached housing sector to fuel Sydney’s property boom. Despite this decline, approvals for detached houses are still 54% higher than this time last year.
Approvals for brand new apartment developments have remained stagnant at approximately 0.7%, highlighting the vulnerability of the apartment sector.
Another indication of growth and decline in the property market is the monthly Performance of Construction Index, with any figures over 50 demonstrating growth. For the month of June, the index concluded a figure of 55.5, with the apartment sector showing an index of 48.9, suggesting a decline.
Despite concerns of growth surrounding the apartment sector, detached housing seems to be fuelling this property boom, as prices continue to increase. Dwelling prices have increased by 2.6% for the month of June in Sydney, behind Hobart.
Source: AFR
The exception is the apartment sector where constraints on migration are hampering demand. This sector has been central to economic activity in Sydney and Melbourne for much of the past decade.
Total change in median dwelling price across Australia: May - June 2021
SYD
Up 2.6%
MELB
Up 1.5%
BRIS
Up 1.9%
PER
Up 0.2%
ADL
Up 1.6%
CAN
Up 2.3%
DRW
Up 0.8%
HBA
Up 3%
