Apartment approvals lift September total but pipeline stays thin

Dwelling approvals rose 5.1 per cent in September to 17,948 on a seasonally adjusted basis, according to the Australian Bureau of Statistics, with the gain coming from apartments and townhouses while detached house approvals fell.

Private sector approvals for dwellings other than houses climbed 16.6 per cent to 6,579. Private sector house approvals dropped 5.3 per cent to 10,432, which the ABS said was the largest monthly fall in that series since August 2025. The figures are summarised in this breakdown of the September ABS data.

For developers, builders and suppliers the headline number matters less than the detail beneath it. The apartment lift is one month, it is concentrated in NSW, and Master Builders is forecasting a steady decline in new home building.

NSW supplied nearly half the apartments approved

In original terms, 4,129 apartments were approved nationally in September, 25.6 per cent more than in August and a touch above the 12-month monthly average of 4,106. NSW accounted for 1,995 of them, up from 901 in August.

Outside NSW, September's apartment approvals came to roughly 2,100 on those figures, so the national gain rests on one state's result.

Townhouses recovered some ground too. Approvals reached 2,792 in original terms, 8.3 per cent up on an August that had dropped 19.4 per cent, though still short of the 2,864 monthly average for the past year.

The annual comparison is the one to carry into pipeline assumptions. Against September 2025, private non-house approvals are down 20.5 per cent in seasonally adjusted terms, and total approvals are down 0.8 per cent.

ABS private sector house approvals fall after August rise

The 5.3 per cent fall in private house approvals followed a 5.4 per cent rise in August and was spread across the states. Private house approvals were still 9.6 per cent higher than a year earlier.

ABS head of construction statistics Daniel Rossi said it was "the ninth consecutive month where more than 10,000 private sector houses have been approved across Australia".

Across all dwelling types, total approvals rose 37.3 per cent in NSW and 28 per cent in Queensland. Victoria fell 28.9 per cent, Tasmania 25.7 per cent, Western Australia 8.7 per cent and South Australia 3.2 per cent. For suppliers with national order books, that is two states growing and four shrinking in the same month, with Victoria recording the largest fall.

Housing Accord target hinges on turning approvals into homes

The ABS series counts consents rather than commencements or completions. The National Housing Accord target of 1.2 million new homes by mid-2029 depends on the gap between the two narrowing.

Property Council chief executive Mike Zorbas put the problem squarely on the post-approval stage. "We need to make sure every possible approval becomes a home," he said. He listed finance and investment, enabling infrastructure and the cost of post-approval processes as the barriers that stop consented projects getting off the ground.

Master Builders Australia chief economist Shane Garrett said the September rise arrived as builders' forward books became "increasingly uncertain". He said the association's latest forecasts have new home building activity declining steadily over the coming years and landing "substantially lower than anticipated just six months ago".

Home Price Report shows October median fall

The demand side explains the caution. The realestate.com.au Home Price Report has the national median down 0.3 per cent in October and 4.3 per cent below the March peak, according to the October home price update.

The Reserve Bank raised the cash rate in late September for the fourth time this year, after moves in February, March and May, taking it to a 15-year high. Ahead of the board's November meeting, financial markets were pricing about an 80 per cent chance of a further 25 basis point rise after ABS data showed headline inflation at its highest level since March.

Federal budget changes that end negative gearing on established properties and scrap the 50 per cent capital gains tax discount were designed to cool investor demand, and investor demand has fallen sharply in Perth, where more homes are coming onto the market.

Sydney prices are 6.7 per cent below their November 2025 peak and Melbourne is 6.1 per cent lower over the year. Brisbane is 5.8 per cent below its March peak and Perth is down 5.7 per cent. REA Group senior economist Eleanor Creagh said some of the sharpest recent declines were now in Brisbane, Adelaide and Perth, and that weaker conditions were likely to extend into 2027. Brisbane's fall from peak is the figure to test in south-east Queensland feasibilities and presales.

That matters most for the apartment approvals NSW has just booked. Projects consented into a market where off-the-plan buyers face a higher cash rate and falling comparables will find presale hurdles harder to clear, which is where the financing barriers Zorbas describes bite.

How do suppliers size orders from approvals?

Treat September as one data point. Before adjusting procurement, staffing or forward orders, run these checks:

• Conversion rate. Compare approvals in your target segments against commencements in the ABS building activity series and size forward orders on that ratio rather than on the approvals count.
• State weighting. NSW and Queensland lifted while Victoria, Tasmania, WA and SA fell in September, so a national average will overstate work in Victoria, Tasmania, WA and SA.
• Annual base. The 20.5 per cent annual fall in private non-house approvals gives a sounder base for capacity decisions than the 16.6 per cent monthly rise.

Master Builders' forecasts and the Property Council's call for enabling infrastructure are the two industry positions to read against your own forward book before the ABS releases the October approvals next month.