Almost 15,500 new homes were approved for construction across Australia in October, marking the highest number of approvals since December 2022.

The latest Australian Bureau of Statistics figures showed home building approvals rose 4.2% to 15,498 in October, following a 5.8% increase in September.  

The overall rise was driven by an increase in apartment developments approved in NSW and Victoria, with unit approvals rising almost 25% compared to last month, ABS head of construction statistics Daniel Rossi said. 

New apartment and unit building approvals rose by 24.8% month-on-month in October to 5,859 dwellings, up 7.1% on the same time last year.

"Meanwhile, private sector house approvals fell by 5.2% in October, after reaching a two-year high in September,” Mr Rossi said.  

Housing Industry Association (HIA) economist Maurice Tapang said the latest data confirmed the rise in home building activity expected next year.  

New apartment and unit building approvals rose 24.8% month-on-month in October. Picture: Getty

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“It has been more than a year since the RBA last raised interest rates,” he said. “Unchanged interest rate settings has provided some degree of certainty for consumers. 

“Households are returning to new home building despite there being no cut to the cash rate. This is because unemployment remains at very low levels, while housing demand remains very strong.”  

Home building material prices have grown at a more normal pace as well, with the latest HIA data showing a 1.4% annual increase in September 2024.

“Low unemployment, unchanged interest rates, stable growth in materials prices and a return to normal build times are helping lift up the market from its recent trough,” Mr Tapang said.  

More than 169,000 new homes have been approved over the past 12 months, a rate that would see just 847,000 new homes built over the next five years.  

At that rate, Australia would fall 353,000 new homes short of the National Housing Accord target of 1.2 million new homes by mid-2025.  

Master Builders Australia chief economist Shane Garrett said failing to deliver much-needed housing was taking a toll on Australians. 

“New home building has clearly won momentum, but we need to see much more improvement or there is little hope of reaching our Accord’s target of 1.2 million new homes by July 2029,” Mr Garrett said.  

“The year to October 2024 saw rents increase by another 6.7% on already onerous levels. This is a direct result of years of underbuilding of new apartments and units.”