Scott Mackey.
Scott Mackey.

Why building approvals have hit a five-year low

The number of newly approved dwellings for construction in Bundaberg has dropped notably over several years, with the number of approved dwellings at the lowest point since at least 2014.

In August 2015, the number of building approvals for dwellings was 454.

In August this year, it was 347.

The number of total dwelling approvals is split between approvals for new houses and other residential buildings, though approvals for the latter have dropped dramatically.

In the year to August 2015, 363 new houses and 91 other residential buildings were approved for construction.

In the year to August 2019, 342 new houses were approved while just five other residential buildings got the nod.

As with most things, it all comes back to the money.

Owner of Remax Precision Scott Mackey said the decline in building approvals could be attributed to the lack of financing from the banks following the Royal Commission.

"The banking aspect is a big thing," he said.

While Mr Mackey definitely believed something needed to be done, the impact of the Royal Commission is flowing on to local economy.

Despite the decline in approvals, the total value of new houses have actually increased nearly $10 million since 2015.

Mr Mackey said this was due to a definite increase in the number of expensive houses being built and fewer mid-to-low end market houses being built.

"You're looking at the difficulties of financing," he said, adding that because of the tightening of banks after the Royal Commission has seen fewer blocks being purchased as people were unable to get financing.

The decline in other residential building approvals has naturally seen a drop in the total value of those that were approved.

The 91 other residential approvals in the year to August 2015 were valued at over $14.5 million, while the five that were approved in the year to August 2019 were valued at just over $1.3 million.

It's this drop that could be attributed to the more than $14.8 million drop in the value of total building approvals since 2015, from $204 million to $189 million, despite growth in other areas.

While high-end housing might be receiving a lot of attention, especially in oceanfront areas, Mr Mackey said there was less land being developed and fewer people had the expendable cash to improve and upgrade their homes.

While the value of total building approvals is a field that fluctuates a lot as the years go by, figures below the $200 million mark stand out as being below par over the past few years.

A decline in non-residential buildings is something that was noted by Mr Mackey also, stating that "we really haven't seen too much of that either".

In terms of comparison, the Fraser Coast region was approved for 694 total dwellings, Gladstone saw 61 approvals, Rockhampton saw 123, Mackay saw 335 and the Sunshine Coast saw 4,199.

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