Building approvals slipped for a second straight month in April, but industry leaders say the data doesn’t tell the whole story about where housing supply is heading next.
Building approvals fell 3.4% in April to 16,710, according to seasonally adjusted data from the Australian Bureau of Statistics (ABS), following a 10.5% decline in March 2026.
Across the states, results were mixed. New South Wales led the fall, down 9.5%, followed by Western Australia (-7.4%) and Victoria (-3.9%).
Total approvals fell for a second consecutive month in April to 16,710. Picture: Getty
In contrast, approvals surged in Tasmania (up 42.2%), while South Australia rose 4.3% and Queensland edged higher by 0.3%.
ABS head of construction statistics Daniel Rossi said private dwellings excluding houses was the category that drove the overall decline.
“The fall in total dwellings approved was driven by a 3.6% fall in private dwellings excluding houses, after falling 25.7% in March,” he said.
Within that category, apartment approvals actually rose 9% to 4,108 dwellings, driven by NSW.
But approvals for semi‑detached dwellings fell 5.8% to 2901, dragging the category down overall.
Detached house approvals slipped 1% in April but remain at elevated levels, Mr Rossi said.
“This is the third consecutive month with over 10,000 private sector houses approved,” he said.
“The last time this occurred was during the final three months of 2021.”
Despite the monthly decline, approvals are higher than one year ago.
Total approvals are 10.2% higher on year-on-year terms, while detached house approvals are up 7% and private sector dwellings excluding houses are 20.5% higher year‑on‑year.
REA Group senior economist Anne Flaherty said total approvals in the first months of 2026 were also higher than the same period last year.
“Comparing the first four months of 2026 with the same period last year, approvals are up 5%, driven by a 9% rise in new house approvals, while dwellings other than houses were down 1%," she said.
The big picture
Economists and policy advocates say April’s results are not necessarily indicative of the broader housing supply outlook.
Ms Flaherty said there are a number of factors impacting building activity.
"Key factors impacting development activity in 2026 are higher interest rates and rising building costs," she said.
"Greater incentives for investors to buy new rather than established properties could drive more demand to the new homes sector and support supply."
Property Council group policy and advocacy executive Matthew Kandelaars said approvals are only one part of the equation, with delivery and project feasibility ultimately determining how many homes are built.
“Across April we continued to see rising cost pressures, global volatility and increasing speculation and uncertainty in the lead up to the Federal Budget, all of which influence how projects stack up,” Mr Kandelaars said.
“Softer approvals reflect a more cautious investment environment, higher costs and greater uncertainty.”
Housing Industry Association (HIA) senior economist Tom Devitt said recent events, including international conflict, budget announcements and rising interest rates, were likely to influence approvals in the second half of the year.
“These issues magnify the importance of the role of governments to reduce the cost of delivering a new home to market,” he said.
The 2026 federal budget included a range of measures aimed at boosting housing supply.
These included changes to negative gearing and the capital gains tax discount, as well as the $2 billion Local Infrastructure Fund.
The fund will support infrastructure such as roads, water, power and sewerage, enabling the construction of up to 65,000 homes over the next decade.
Buyer demand, however, remains resilient. The HIA’s latest New Home Sales report found sales rose 4.9% in April.
“Australia is not expected to build enough homes to meet current and future demands,” Mr Devitt said.
“Taxes and regulations on home building need to be reduced and skills shortages addressed, if Australia is to meet its housing targets.
“Budget measures to deliver ‘enabling’ infrastructure like transport and utilities will support home building over the medium‑to‑long term.”
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