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Building approvals show marginal improvement

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1 October 1996

3 r d F lo o r

C o n s t r u c t i o n H o u s e

2 1 7 N o r t h b o u r n e A v e .

T u r n e r , C a n b e r r a

A C T 2601 T el: (0 6 ) 2 4 9 1433

F ax: (0 6 ) 2 4 9 1373

BUILDING APPROVALS SHOW MARGINAL IMPROVEMENT Statement by Wilhelm Harnisch, National Director, Economics and Housing

The total number o f dwelling units approved in August 1996 rose marginally by 1.6 per cent (seasonally adjusted) on the month o f July. The increase, while welcome, still shows that conditions in the housing industry remain flat but nevertheless considerably better than earlier this year.

On a three monthly basis, building approvals have risen by 3.3 per cent, which is a positive sign, and should help to put "some wind in the sails" o f a long awaited housing recovery. The rise in the building approvals on a three monthly basis should lead to a positive start to the number o f dwellings commenced in the September quarter 1996.

MBA supports the call for a further reduction in interest rates in light o f a slowing economy. A further cut in interest rates will send out an important signal to the general business community and to home owners, that Australia has entered a more stable interest rate environment. However, the cut in interest rates is unlikely to lead to a strong resurgence in housing activity. The projected recovery in housing for 1996-97 is modest given the accumulative effect o f low population growth, primarily due to lower immigration, and the

projected slowing in employment growth.

For further information contact:

Wilhelm Harnisch

BH: (06) 249 1433 M aster Builder,

' ' A u s t r a l i a Inr-i-vm.

AH: (06) 288 9650

Australia Incorporated

A.R.B.N. 008 383 453 Incorporated in

South Australia with

limited liability