Building Approvals in Australia

It captures the number (and sometimes the value) of dwellings and buildings approved for construction in Australia during the month, that is, the permits granted to start work. It is published by the Australian Bureau of Statistics (ABS) as a leading indicator of future building activity.

It is built from the reports of the local authorities that grant approvals. The headline is the number of dwellings approved on a seasonally adjusted basis, released as a month-on-month and year-on-year change.

Approvals foreshadow the start of new work and hence residential construction investment, a big driver of jobs and supporting industries. A strong reading points to more activity and future credit demand, relevant for the Reserve Bank of Australia (RBA).

Building does not always begin in the month a permit is granted, so the indicator does not exactly reflect work actually started. It is highly volatile, especially because of large multi-unit projects, and is subject to revision.