Simon Johanson | AAP | February 3, 2012
Another fall in building approvals points to a housing industry slump worse than Australia experienced during the global financial crisis, economists say.
Building approvals in December fell 1 per cent to 11,443 units from the previous month, and were down 24.5 per cent over the year, Australian Bureau of Statistics data shows.
“Building approvals in late 2011 imply that housing starts will fall to a level below that experienced during the depth of the GFC, which would clearly be a very unhealthy outcome,” the Housing Industry Association economist Harley Dale said.
Approvals were weaker in Victoria and NSW, which experienced large falls, Mr Dale said.
In Queensland they jumped 24.6 per cent, seasonally adjusted. Approvals in Tasmania and Western Australia also rose.
Economists had forecast an overall rise of 2 per cent for December.
The continuing eight-month decline in approvals would mean building activity was likely to remain soft for some time, the National Australia Bank’s senior economist, Spiros Papadopoulos, said.
The Reserve Bank’s decision to cut the cash rate in November and December had not yet provided the hoped-for boost to the housing sector, he said.
But the weaker data would encourage the Reserve Bank to cut rates again, the CommSec economist Savanth Sebastian said.
”The Reserve Bank won’t be overly perturbed,” he said. ”They know that rate cuts will start to have an impact in coming months, but I think the economy as a whole needs a further degree of support.”