For your information, below is a compilation of news and updates compiled from referenced sources.

HIA Building Approvals Data, August 2021

Globally, timber supply cannot meet demand

Unprecedented demand for framing timber is at record-high levels right across the world, including here in Australia.  The boom of the global population’s demand for new detached homes and renovations of existing dwellings is due to a combination of factors which include:

• playing catch-up from the 2020 scale-back in supply and shipping
• the earlier lockdowns in 2020 which postponed home purchases
• record-low mortgage interest rates
• the availability of increased savings and global home building stimulus’

Home is where the heart is, now more than ever before.

In Australia, the Federal Government expected 27,000 applications for new home starts under the HomeBuilder scheme. More than 121,000 applications were received.  As a result, Australia-wide housing approvals are at record levels. According to HIA data, there was a 39% increase in total dwelling approvals from January to June 2021, compared to the same period last year, with the majority of that increase attributed to new houses.

Total Australian Dwelling Approvals, HIA August 2021

	Jan – June 2021	Jan – June 2020	Variance %
Australia – Total Approvals	118,544	84,987	39.48%
Australia – Single Detached Houses	80,274	52,227	53.70%
Australian – Units or Townhouses	38,270	32,760	16.82%

 

The timber supply situation in Australia

Every Australian merchant continues to struggle to secure enough timber volume from both overseas and local producers and distributors.

• Local timber production does not meet local demand, even in usual conditions
• Last year’s bushfires and the significant losses to saw log supply have impacted local timber production capacity
• With the global demand for timber (lumber in American terms) at an all-time high, overseas based pine suppliers are choosing to send their products to the US or other markets where they can get the higher price, leaving Australia short
• The surged demand for timber has resulted in ongoing notifications of price increases which continue to be received from building supply manufacturers
• The demand-supply imbalance cannot be resolved easily
• No-one knows exactly when this huge spike in building work will drop. But, it will come with time
• FWPA, ABS, derived and Data Analyst Advisory Group IndustryEdge source shared this: “Our view is that the pipeline will take at least one year to build out, assuming everything goes back to normal on the demand side and the supply side continues to build flat out. In reality, with building industry lockdowns, supply chain disruptions and so on, we can expect the pipeline will take until at least the end of 2022 to be built out”
• As housing starts slow down, the pressure of the supply imbalance will decrease
• This pandemic has created the need for many businesses, across a broad range of industries, to prioritise limited supply to existing, loyal customers. Dahlsens too will continue to follow this strategy until such a time when supply is not challenged
• The long-standing relationships Dahlsens has built over time with suppliers aim to withstand the inherent cycles of the building industry, even this unprecedented time.  It is true that these business partnerships have strengthened our supply position
• The key timber suppliers to Dahlsens, two of Australia’s largest framing timber producers, Timberlink and Hyne Timber, continue to honour priority supply, fast-tracking investments and innovations, working around the clock to further improve efficiencies, create access to additional resources and increase timber production to meet demand
• Price increases, whilst debilitating, are limiting Australian softwood timber from being exported, which is protecting supply for local building.  2.5% of our softwood production is being exported, according to the Forest and Wood Products Australia, see graph below, of which is largely low-grade, non-structural product used to make products such as furniture and pallets.

 

• The pandemic has shone the spotlight on the value of local manufacturing, and we are an industry with a high level of Australian manufacturing.  Dahlsens has strong supply relationships with the likes of Corinthian Doors, Rinnai, James Hardie, Laminex, Gyprock, Boral, and many more that manufacture right here on our shores, supporting local jobs and the Australian economy

Where to from here for builders regarding timber supply, a recommendation….

1. Conservatively plan for delays as well as price increases in projects
2. Provide suppliers with as much advance notice as possible of building supply needs
3. Keep suppliers up to date with project requirements, as accurately as possible, so that customers jobs’ can be prioritised in order of requirements to site. Communication is more important than ever
4. Plan for the time when there is a decrease in consumer demand for new housing

In the news: 50 containers of Aussie bound timber abandoned in China

Five hundred homes worth of timber destined for Melbourne has been abandoned at a Shanghai dock because a shipping company accepted a lucrative offer to divert course to Los Angeles. Source: The Age, The Hardware Journal.

The Master Builders Association of Victoria (MBAV) said 50 containers carrying timber had been dumped in China and warned the incident could worsen Australia’s timber shortage and lead to unfinished homes.

The shipment of European timber arrived in Shanghai in late July. The shipping company was then offered 60% more to use its shipping containers, according to the MBAV, prompting the ship to dump the timber at the Chinese port and leave for the US with new goods on board. It is unclear how the company was able to take this action, given it had a contract to deliver the goods to Australia.

 

Note, not one of Dahlsens’ suppliers, but another challenge for global supply.

Article from 18 August 2021 TimberBiz  READ MORE

Report: HIA New Home Sales Current Update 

• Demand for detached housing remains robust. Low interest rates and changes in consumer preference for location of housing have been the major drivers for activity following the end of HomeBuilder
• ABS Housing Finance data and Approvals data indicate that the bulk of projects initiated by HomeBuilder have cleared the final regulatory hurdles. There is now a record number of homes under construction across the country
• Despite national new home sales declining by 20.5 per cent in July compared to the previous month, with lockdowns in multiple states having restricted trading and eroded confidence, new home sales for the last three months remain 4.3 per cent higher than in the same period in 2018. This suggests a solid amount of building activity is still entering the pipeline, following the end of the HomeBuilder

Excerpt from the July edition of HIA New Home Sales Report (Monthly). READ MORE

In the news: Melbourne population falls 32,000, State’s housing boom rolls on

More than 32,000 Melburnians quit the city in the 12 months to March, the highest number to leave any Australian capital during this period of time.

Australian Bureau of Statistics figures to March show 18,000 of those left the state, the majority of these leaving for Queensland, South Australia and Western Australia.

The remaining 14,000 moved to regional Victoria.

Article from 3 August 2021 realestate.com.au. READ MORE

In the news: Queensland tops the housing scorecard

Queensland has been propelled to the top of HIA’s Housing Scorecard for the first time since 2007.  The HIA Housing Scorecard report presents analysis which ranks each of the eight states and territories based on the performance of 13 key residential building indicators, including detached and multi-unit building activity, renovations, housing finance, and rates of overseas and interstate migration.

“With building activity booming across the economy it is difficult to pick just one jurisdiction that is outperforming the pack. Even in this strong market, Queensland has made the most of its opportunities,” HIA economist Tom Devitt said.

“Interstate migration has offset some of the loss of overseas migration in Queensland, unlike other east coast states.

“More than twice the number of interstate migrants are heading to Queensland than the average of the past decade. Other states have also seen a rise in interstate migration but none as strong as Queensland,” he said.

“The biggest mover has been Western Australia having jumped from the bottom of the table into fifth place in less than a year,” Mr Devitt said.

“The exodus of residents from Western Australia that has occurred for several years has been reversed and there are encouraging signs that the multi-unit market might also pick up.”

Article from 9 August 2021 TimberBiz  READ MORE

In the news: What the 2032 Olympic Games means for Brisbane property market?

The Olympics should work as a positive influence on Brisbane housing market conditions, however, with the Games still some eleven years away, the flow on effects are likely to be gradual and centred around significant infrastructure upgrades and the associated medium-term uplift in jobs and longer-term improvements in transport efficiency.

The most significant positive influence on the housing market is likely to be seen in the years leading up to the Olympics, rather than during the four weeks of the Olympic and Paralympic games themselves.

Article from 22 July Core Logic READ MORE

In the news:  Construction Industry A $360bn House of Cards

Australia’s construction industry is a $360-billion house of cards teetering in a profitless boom in which builders big and small are going bust—and warnings from its coalface indicate the worst is yet to come.

According to industry leaders, long-established cracks in the sector’s foundation are now so wide that it is “totally unsustainable” and in need of urgent major reform if it is to have the capacity to build projects that need to be built.

Up to 25 per cent of all insolvencies in Australia are companies within the construction industry.

“It’s a bit of a shocking statistic,” says Australian Constructors Association (ACA) chief executive Jon Davies. “Particularly when you look at it in terms of the industry’s contribution to the economy (8 to 10 per cent of GDP) it’s a disproportionately high level.

“At the moment you are hearing a lot of people talking about a ‘profitless boom’ and it has been a reality.”

“But the bigger issue is not so much the profit margins, it’s the willingness of our industry to accept risks that they really aren’t able to quantify, and they really shouldn’t be trying to, from clients that are more than happy to try to pass those risks onto them.”

Article from 2 July 2021 The Urban Developer READ MORE

In the news: Victoria introduces anti-wage theft laws that could see companies fined more than $1 million

Companies that deliberately underpay workers could face fines of more than $1 million under new wage theft laws coming into effect in Victoria [July 1 2021].

Individuals who deliberately underpay staff or dishonestly withhold wages could face up to 10 years’ jail, or fines over $200,000. For companies, the possible fine can be as high as $1,090,000.

Article from 1 July 2021 ABC News  READ MORE 

                                                                                                     

Dwelling Approvals Victoria and New South Wales, HIA August 2021

Location	Greater Sydney			Greater Melbourne
Dwelling Type	Total Dwelling	Single Detached House	Unit/ Townhouse	Total Dwelling	Single Detached House	Unit/ Townhouse
Jul-20	3,184	1,406	1,778	4,304	2,593	1,711
Aug-20	2,224	1,353	871	4,210	2,348	1,862
Sep-20	2,444	1,445	999	4,639	2,491	2,148
Oct-20	3,699	1,390	2,309	3,950	2,491	1,459
Nov-20	3,789	1,372	2,417	3,478	2,319	1,159
Dec-20	2,992	1,414	1,578	3,201	2,126	1,075
Jan-21	2,654	998	1,656	2,454	1,682	772
Feb-21	3,137	1,428	1,709	4,068	2,691	1,377
Mar-21	4,117	1,580	2,537	5,601	3,227	2,374
Apr-21	4,841	1,691	3,150	4,025	3,079	946
May-21	4,566	1,955	2,611	4,336	2,896	1,440
Jun-21	3,280	1,444	1,836	5,370	3,036	2,334

 

Even though Victoria has been experiencing a mass-exodus, the housing starts numbers for June continue to hover around their peak with 6950 new dwellings getting the green light.  New South Wales on the other hand, saw a sharp decline in June, down from 6347 to 5003.

In the capitals,  Sydney approvals have also dropped significantly in June down 39% from May 2021, while Melbourne rose 19.26%.

In the Victorian regional areas, the municipals leading the way for June 2021 vs June 2020 increases were Latrobe Valley (150%), Baw Baw (142%), Surf Coast + Bellarine Peninsula (140%) and South West Gippsland (96%).

In New South Wales the standouts were Wyong (up 64 houses from 0), Central Coast (327%), Dubbo (200%) and Taree – Gloucester (189%).

Overall for Australia, this is the third month in a row that total dwelling approvals have dropped.

“Since the unwinding of stimulus measures, approvals for private houses have fallen 20.9 per cent from the record high in April. Despite the fall, private house approvals remain at elevated levels and are 44.3 per cent higher than June 2020 and 37.6 per cent higher than June 2019,” said Daniel Rossi, ABS Director of Construction Statistics. 

 

Housing Approvals data provided by HIA, August 2021

(scroll down the lists below to find all regions in Victoria and New South Wales)

Vic and NSW – Single Detached Houses Approvals 

 

Locations	State	June 2021	June 2020	% Difference	Rolling 12 Months	Previous Rolling 12 Months	% Difference
Victoria	VIC	4511	3136	43.85%	47742	36255	31.68%
Greater Melbourne	VIC	3036	2145	41.54%	30979	25305	22.42%
Ballarat	VIC	136	118	15.25%	1966	1169	68.18%
Baw Baw	VIC	109	45	142.22%	948	619	53.15%
Bendigo	VIC	122	128	-4.69%	1606	1187	35.30%
Campaspe	VIC	5	15	-66.67%	235	162	45.06%
Geelong	VIC	259	194	33.51%	2510	1646	52.49%
Gippsland – East	VIC	55	35	57.14%	533	326	63.50%
Gippsland – South West	VIC	102	52	96.15%	1145	688	66.42%
Grampians	VIC	11	14	-21.43%	231	142	62.68%
Latrobe Valley	VIC	65	26	150.00%	606	296	104.73%
Melbourne – Inner East (Boroondara, Manningham, Whitehorse)	VIC	55	63	-12.70%	664	682	-2.64%
Melbourne – Inner South (Bayside, Glen Eira, Kingston, Stonnington – East)	VIC	47	63	-25.40%	592	715	-17.20%
Melbourne – Inner suburbs	VIC	26	31	-16.13%	331	349	-5.16%
Melbourne – North East (Banyule, Darebin – North, Kinglake, Whittlesea)	VIC	438	278	57.55%	4013	3275	22.53%
Melbourne – North West (Keilor, Macedon Ranges, Moreland – North, Sunbury, Tullamarine)	VIC	372	279	33.33%	4446	3655	21.64%
Melbourne – Outer East (Knox, Manningham, Maroondah, Whitehore – East, Yarra Ranges)	VIC	75	82	-8.54%	1151	1048	9.83%
Melbourne – South East (Cardinia, Casey-North, Casey-South, Dandenong, Monash)	VIC	603	526	14.64%	6307	4952	27.36%
Melbourne – West (Brimbank, Hobsons Bay, Maribyrnong, Melton – Bacchus Marsh, Wyndham)	VIC	1351	760	77.76%	12558	9681	29.72%
Mildura	VIC	27	15	80.00%	390	230	69.57%
Mornington Peninsula – Frankston	VIC	69	63	9.52%	917	948	-3.27%
Murray River – Swan Hill	VIC	17	9	88.89%	170	92	84.78%
Shepparton	VIC	40	23	73.91%	584	364	60.44%
Surf Coast – Bellarine Peninsula	VIC	207	86	140.70%	2035	1421	43.21%
Upper Goulburn Valley	VIC	51	34	50.00%	538	431	24.83%
Wangaratta – Benalla	VIC	27	25	8.00%	344	220	56.36%
Warrnambool	VIC	30	24	25.00%	428	289	48.10%
Wellington	VIC	25	15	66.67%	377	222	69.82%
Wodonga – Alpine	VIC	72	55	30.91%	834	489	70.55%
New South Wales	NSW	2634	2074	27.00%	30062	24193	24.26%
Greater Sydney	NSW	1444	1223	18.07%	17476	14422	21.18%
Albury	NSW	44	33	33.33%	652	412	58.25%
Bathurst	NSW	23	21	9.52%	323	239	35.15%
Central Coast	NSW	94	22	327.27%	981	675	45.33%
Coffs Harbour	NSW	29	20	45.00%	384	269	42.75%
Dapto – Port Kembla	NSW	28	24	16.67%	427	316	35.13%
Dubbo	NSW	33	11	200.00%	396	191	107.33%
Gosford	NSW	30	22	36.36%	311	320	-2.81%
Goulburn	NSW	37	17	117.65%	273	148	84.46%
Griffith	NSW	7	5	40.00%	132	109	21.10%
Kiama – Shellharbour	NSW	55	31	77.42%	558	383	45.69%
Lake Macquarie	NSW	126	85	48.24%	938	790	18.73%
Lower Hunter	NSW	104	60	73.33%	917	621	47.67%
Maitland	NSW	81	71	14.08%	870	994	-12.47%
Newcastle	NSW	25	42	-40.48%	354	355	-0.28%
Orange	NSW	35	25	40.00%	260	239	8.79%
Port Macquarie	NSW	49	31	58.06%	402	361	11.36%
Port Stephens	NSW	27	19	42.11%	267	187	42.78%
Rest of NSW	NSW	1190	851	39.84%	12586	9771	28.81%
Richmond – Tweed	NSW	90	73	23.29%	910	831	9.51%
Shoalhaven	NSW	41	55	-25.45%	620	465	33.33%
South Coast – Batemas Bay, Bega, Merimbula	NSW	32	36	-11.11%	431	337	27.89%
Southern Highlands	NSW	17	6	183.33%	211	216	-2.31%
Sutherland	NSW	34	17	100.00%	314	187	67.91%
Sydney – Baulkham Hills and Hawkesbury	NSW	100	141	-29.08%	2148	1787	20.20%
Sydney – Blacktown	NSW	352	294	19.73%	3455	2840	21.65%
Sydney – City and Inner South	NSW	15	8	87.50%	121	86	40.70%
Sydney – Eastern Suburbs (Bondi, Coogee, Randwick)	NSW	11	16	-31.25%	124	179	-30.73%
Sydney – Inner South West (Bankstown, Cantebury, Hurtsville)	NSW	96	68	41.18%	1017	1007	0.99%
Sydney – Inner West (Canada Bay, Leichhardt, Strathfield)	NSW	29	20	45.00%	294	227	29.52%
Sydney – North Sydney (Chatswood, Hornsby, Mosman)	NSW	58	44	31.82%	502	489	2.66%
Sydney – Northern Beaches (Manly, Pittwater, Warringah)	NSW	26	26	0.00%	435	351	23.93%
Sydney – Outer South West (Camden, Campbelltown, Wollondilly)	NSW	142	180	-21.11%	2120	1812	17.00%
Sydney – Parramatta	NSW	67	63	6.35%	875	722	21.19%
Sydney – Penrith, Richmond, Blue Mountains	NSW	78	99	-21.21%	1028	984	4.47%
Sydney – Ryde	NSW	32	17	88.24%	240	201	19.40%
Sydney – South West (Bringelly, Fairfield, Liverpool)	NSW	310	208	49.04%	3822	2875	32.94%
Tamworth	NSW	31	12	158.33%	304	180	68.89%
Taree – Gloucester	NSW	55	19	189.47%	317	209	51.67%
Wagga Wagga	NSW	42	20	110.00%	533	382	39.53%
Wollongong	NSW	18	31	-41.94%	239	215	11.16%
Wyong	NSW	64	0		670	355	88.73%
Australian Capital Territory	ACT	125	90	38.89%	1491	1233	20.92%

Vic and NSW – Units and Apartment Approvals 

Locations	State	June 2021	June 2020	% Difference	Rolling 12 Months	Previous Rolling 12 Months	% Difference
Victoria	VIC	2439	1492	63.47%	19926	23760	-16.14%
Greater Melbourne	VIC	2334	1403	66.36%	18657	22824	-18.26%
Ballarat	VIC	6	4	50.00%	188	79	137.97%
Baw Baw	VIC	2	0		48	27	77.78%
Bendigo	VIC	2	4	-50.00%	23	73	-68.49%
Campaspe	VIC	0	0		8	5	60.00%
Geelong	VIC	44	17	158.82%	355	339	4.72%
Gippsland – East	VIC	0	0		8	0
Gippsland – South West	VIC	0	7	-100.00%	38	34	11.76%
Grampians	VIC	2	2	0.00%	26	7	271.43%
Latrobe Valley	VIC	0	35	-100.00%	20	50	-60.00%
Melbourne – Inner East (Boroondara, Manningham, Whitehorse)	VIC	290	106	173.58%	2414	2659	-9.21%
Melbourne – Inner South (Bayside, Glen Eira, Kingston, Stonnington – East)	VIC	287	129	122.48%	2820	1702	65.69%
Melbourne – Inner suburbs	VIC	340	557	-38.96%	4258	9075	-53.08%
Melbourne – North East (Banyule, Darebin – North, Kinglake, Whittlesea)	VIC	234	164	42.68%	1666	1912	-12.87%
Melbourne – North West (Keilor, Macedon Ranges, Moreland – North, Sunbury, Tullamarine)	VIC	93	91	2.20%	979	1228	-20.28%
Melbourne – Outer East (Knox, Manningham, Maroondah, Whitehore – East, Yarra Ranges)	VIC	138	93	48.39%	1153	1327	-13.11%
Melbourne – South East (Cardinia, Casey-North, Casey-South, Dandenong, Monash)	VIC	223	120	85.83%	1813	1950	-7.03%
Melbourne – West (Brimbank, Hobsons Bay, Maribyrnong, Melton – Bacchus Marsh, Wyndham)	VIC	655	121	441.32%	3070	2418	26.96%
Mildura	VIC	0	4	-100.00%	25	12	108.33%
Mornington Peninsula – Frankston	VIC	74	22	236.36%	484	553	-12.48%
Murray River – Swan Hill	VIC	0	0		13	9	44.44%
Shepparton	VIC	0	0		38	16	137.50%
Surf Coast – Bellarine Peninsula	VIC	8	16	-50.00%	219	204	7.35%
Upper Goulburn Valley	VIC	4	0		23	24	-4.17%
Wangaratta – Benalla	VIC	10	0		50	4	1150.00%
Warrnambool	VIC	2	0		95	10	850.00%
Wellington	VIC	8	0		19	7	171.43%
Wodonga – Alpine	VIC	0	0		8	4	100.00%
New South Wales	NSW	2369	1160	104.22%	28706	23757	20.83%
Greater Sydney	NSW	1836	924	98.70%	23451	18974	23.60%
Albury	NSW	0	2	-100.00%	27	47	-42.55%
Bathurst	NSW	4	2	100.00%	44	84	-47.62%
Central Coast	NSW	21	19	10.53%	344	446	-22.87%
Coffs Harbour	NSW	21	0		107	70	52.86%
Dapto – Port Kembla	NSW	6	6	0.00%	168	190	-11.58%
Dubbo	NSW	18	8	125.00%	76	73	4.11%
Gosford	NSW	4	19	-78.95%	214	273	-21.61%
Goulburn	NSW	5	12	-58.33%	72	91	-20.88%
Griffith	NSW	0	2	-100.00%	16	12	33.33%
Kiama – Shellharbour	NSW	31	28	10.71%	540	454	18.94%
Lake Macquarie	NSW	82	12	583.33%	360	453	-20.53%
Lower Hunter	NSW	20	8	150.00%	120	46	160.87%
Maitland	NSW	11	28	-60.71%	399	251	58.96%
Newcastle	NSW	166	32	418.75%	810	1260	-35.71%
Orange	NSW	9	4	125.00%	83	35	137.14%
Port Macquarie	NSW	13	12	8.33%	266	142	87.32%
Port Stephens	NSW	4	0		319	36	786.11%
Rest of NSW	NSW	533	236	125.85%	5255	4783	9.87%
Richmond – Tweed	NSW	40	43	-6.98%	351	328	7.01%
Shoalhaven	NSW	3	8	-62.50%	245	305	-19.67%
South Coast – Batemas Bay, Bega, Merimbula	NSW	8	4	100.00%	115	39	194.87%
Southern Highlands	NSW	43	0		197	22	795.45%
Sutherland	NSW	93	25	272.00%	1163	918	26.69%
Sydney – Baulkham Hills and Hawkesbury	NSW	20	6	233.33%	1401	431	225.06%
Sydney – Blacktown	NSW	367	20	1735.00%	3155	1563	101.86%
Sydney – City and Inner South	NSW	29	2	1350.00%	2778	1382	101.01%
Sydney – Eastern Suburbs (Bondi, Coogee, Randwick)	NSW	26	12	116.67%	433	463	-6.48%
Sydney – Inner South West (Bankstown, Cantebury, Hurtsville)	NSW	318	170	87.06%	2309	3306	-30.16%
Sydney – Inner West (Canada Bay, Leichhardt, Strathfield)	NSW	397	80	396.25%	1328	1080	22.96%
Sydney – North Sydney (Chatswood, Hornsby, Mosman)	NSW	123	22	459.09%	1113	910	22.31%
Sydney – Northern Beaches (Manly, Pittwater, Warringah)	NSW	168	82	104.88%	458	206	122.33%
Sydney – Outer South West (Camden, Campbelltown, Wollondilly)	NSW	40	19	110.53%	706	856	-17.52%
Sydney – Parramatta	NSW	92	247	-62.75%	4408	3861	14.17%
Sydney – Penrith, Richmond, Blue Mountains	NSW	8	29	-72.41%	663	626	5.91%
Sydney – Ryde	NSW	105	8	1212.50%	1892	1515	24.88%
Sydney – South West (Bringelly, Fairfield, Liverpool)	NSW	29	183	-84.15%	1300	1411	-7.87%
Tamworth	NSW	6	10	-40.00%	51	69	-26.09%
Taree – Gloucester	NSW	2	2	0.00%	18	70	-74.29%
Wagga Wagga	NSW	2	0		51	34	50.00%
Wollongong	NSW	10	7	42.86%	488	481	1.46%
Wyong	NSW	17	0		130	173	-24.86%
Australian Capital Territory	ACT	200	293	-31.74%	3584	3689	-2.85%