A slump in apartment approvals saw home building permits fall 9.4 per cent in August, according to the Australian Bureau of Statistics.
Tuesday’s Building Approvals report showed permits to build houses fell by 1.9 per cent from a month earlier, but it was a 17.2 per cent drop in apartments approvals that contributed most to the total decline.
The value of buildings approved also fell 9.5 per cent in August after a 6.9 per cent rise in July, again, dragged down by the decrease in apartments being approved.
AMP Capital chief economist Shane Oliver said while apartment approvals was a volatile figure, the ABS report showed the broad downtrend in dwelling approvals has resumed.
“A further softening is likely as new supply hits the property market putting downwards pressure on property prices which will likely reinforce a slowdown in apartment construction,” he said in a statement.
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The emerging downturn in residential construction is further proof the Reserve Bank will leave interest rates on hold until at least 2020, Mr Oliver said.