Melbourne apartment boom rising again

The Melbourne apartment boom has consolidated its recent record level performance with the underlying trend for planned building activity in this market on the rise again.

Latest ABS data reports that 2992 units were approved for building in Melbourne over August which was just below the 3056 approved over the previous month and the second highest monthly total this year so far.

Building approvals for Melbourne units had tapered off at the beginning of this year compared to the extraordinary levels recorded over the same period last year.  Approvals however have come roaring back over the past 5 months to be now clearly tracking above last year’s results at the same time.

Inner Melbourne continues to account for most of the unit approvals with 8247 reported over the first 8 months of this year which was 61.3 percent of the total approved. The inner south was the next highest with 1853 unit approvals.

Melbourne CBD has approved 2278 units this year so far with Carlton 1035 and Southbank 746 the other leading suburb level performers.

Notable middle-ring suburb results include Doncaster with 336, Heidelberg West 290, Box Hill 267, Carnegie 208 and Blackburn with 118 units approved over the first 8 months of this year.

The ongoing Melbourne apartment boom has been a significant catalyst for the recent sustained revival in the local economy. Melbourne has created 86,350 jobs over the past year to August according to the ABS with the jobless rate falling from 5.7 percent to 5.5 percent over the year.

And no sign of supply moving ahead of demand in the apartment market with prices and rents still rising and vacancy rates tightening.

Dr Andrew Wilson is Domain Group Chief Economist Twitter@DocAndrewWilson join on LinkedIn