The data from the ABS shows that the trend estimate of the value of total building work done rose 1.1% in the March 2016 quarter with new residential building work up 2.8%, whilst the value of non-residential building work done fell 1.2%. As a result, 66% of all building activity was for residential purposes, a record. Construction momentum continues therefore, despite falls in building approvals over the same period.
The trend estimate for the total number of dwelling units commenced rose 1.8% in the March 2016 quarter following a rise of 1.2% in the December quarter. Looking at the mix of residential activity, the value of work done on new houses fell 0.7% while new other residential building (units, apartments etc.) rose 7.1%. As a result, 47% of value in March 2016 was for dwellings other than housing, a record. The trend estimate for new private sector house commencements fell 1.4% in the March quarter following a fall of 1.5% in the December quarter. The trend estimate for new private sector other residential building commencements rose 5.5% in the March quarter following a rise of 4.9% in the December quarter.
Overall, 30% of all construction activity (including residential and non-residential) was for units and apartments, with more than 30,000 units in the quarter. This is another record and highlights again the risks in the system.
Finally, it is worth noting where the momentum lays, because there are significant state variations. Looking at the year March 2016, new dwelling commencements rose in ACT (44.1%), NSW (24.1%), QLD (13.1%), VIC (11.6%) and TAS (6.6%). On the other hand they fell in NT (-24.7%), WA (-19.0%) and SA (-3.1%).
