Drop in new home approvals
THE Northern Rivers recorded the biggest drop in new home approvals in regional NSW and Victoria in the 2008-09 financial year, a new report from the Housing Industry Association reveals.
The Population and Residential Building Hotspots report shows new housing approvals in the Richmond-Tweed statistical division fell by 43 per cent from the 2007-08 to the 2008-09 financial years.
Within that, Lismore and the Tweed were hardest hit, recording drops in new building starts of 59pc and 60pc, respectively.
The only area within the statistical division to record growth in home building approvals for the financial year was Richmond Valley, where the number of approvals outside of Casino jumped from a low of 31 to a high of 41, creating a spike of 32pc.
Statistical divisions used by the Australian Bureau of Statistics – the source of the housing association’s figures – are not necessarily the same, as local government boundaries and can provide different results.
For example, Lismore City Council’s figures showed a much smaller drop in approvals of about 26pc.
Lismore City Council’sfigures showed a drop from 123 approvals in 2007-08 to 91 in 2008-09. Importantly, they also showed approvals jumping back up in the 2009-10 financial year, with 101 dwellings approved so far.
Housing Industry Association economist Harley Dale said he expected the number of approvals would have risen as the financial crisis eased and as homebuyers acted on lower interest rates and the boost to the first home owners grant.
Mr Dale said some of the fall in approvals across the region could be blamed on the global financial crisis – but that told only part of the story. Other parts included high growth earlier in the decade, land availability and the ‘lumpiness’ of housing approval figures in regional areas.
“In Lismore you would only need one or two reasonably-sized projects to bolster the figures for one year and as soon as that drops out, that exaggerates the weakness,” Mr Dale said.
The Northern Rivers figures were also coming off a relatively high base.
Mr Dale said the region led the State for several years in housing approval figures and the end of those projects created big drops, even though building approval rates might remain relatively sound.
That definition might be a matter of personal interpretation. Award-winning Ballina-based builder John Eggins said he thought the association’s figures might even understate the drop in approvals.
Mr Eggins said he would have expected Ballina, which recorded a 14pc drop in new home approvals, from 192 to 166, to have been closer to 20pc.
“Across the board, it’s generally very quiet,” Mr Eggins said.
Mr Eggins blamed a shortage of land to build on across the region for the lack of new houses going up. He had managed to avoid laying off workers as the new homes dried up, instead turning to renovations and ‘knock-down-rebuild’ jobs to keep things going.
“People decide to renovate where they are already living rather than move to a new position,” he said.
“They decide they’d like to stay in the area they’re in and where there are neighbours that know them.”