Media Release
5 November 2008
HOUSING APPROVALS SLIDE
Statement by Peter Jones, Chief Economist
Dwelling approvals were in steep decline in September, validating aggressive moves by the Reserve
Bank to lower interest rates, according to Master Builders Australia, the peak body for the building
and construction industry.
Mr Peter Jones, Chief Economist, said “The latest slide in home approvals predates the most recent
turbulent episode in the global financial crisis and dramatic loosening of fiscal and monetary policy,
and reflects the impact of tight financial conditions dampening confidence and delaying recovery.”
He said, The housing slide will impose a major risk to the economy in 2009 unless there is an early
and substantial turnaround in conditions.
“Aggressive fiscal and monetary policy should help to minimise the risk of a severe economic
downturn, however soft conditions in the housing market can be expected over much of calendar
2009, despite the Government’s stimulus package and the RBA’s aggressive rate cuts.
“The latest slide in housing points to the need for more rate cuts in coming months.
“Residential building has fallen well below that required to cater for Australia’s growing population
with a chronic level of underbuilding and shortage of stock is fuelling sharp increases in rents.”
The total number of dwelling units approved, seasonally adjusted, fell by 7.2 per cent to 11,167 units
in September, to be 21.6 per cent lower than the same month in the previous year.
Private sector house approvals fell by 4.7 per cent to 7,774, to be down 16.2 per cent on the same
month last year. The more volatile private sector ‘other dwellings’ (apartments and townhouses), fell
by 15.2 per cent in August, to be 31.5 per cent lower than in September 2007.
For further information: Peter Jones, Chief Economist W 02 6202 8888, M 0403 440 838
NEWS 
