Building permits are up by 11.3 per cent due to a surge in new apartment plans across Australia’s capital cities, making it the biggest jump in over two and a half years and the second biggest in 15 years.
The surge has offset the decline in housing approvals, which was causing concern to the construction industry that weren’t sure of their fate after the previous few years of struggle. Most of these approvals have been in New South Wales and Victoria, with the value of these buildings also rising to new heights at 3.2 per cent in July 2016.
The apartment boom is long overdue, particularly in overcrowded Sydney and Melbourne where there have been lines around the block spotted at many house and apartment inspections and people are splashing the cash to get their dream home, often spending far beyond their budgets. The apartment boom will see these lines reduce and the playing field even out.
Brisbane is also keen to reap the benefits of an apartment boom, with many construction workers, engineers and other specialists flooding back from the mining towns and into the city to pick up the glut of work that is currently available to them.
However, the construction industry isn’t quite celebrating yet, with there being concern that an apartment glut could trigger a drop in prices and bring the housing boom to an end as quick as its beginning. Unsurprisingly, first home buyers are keenly waiting for this to eventuate in the hopes of snapping up something at an affordable price, particularly in Sydney.
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