shock drop in building approvals, page-6

Less building approvals may be a negative for the construction sector and the economy as a whole. The trend, however, is actually a positive for existing house prices and rents as it is capping supply.

Moreover, a weak construction sector will lead to further interest rate reductions.

So as I and many others have already said, the RBA is stuck between a rock and a hard place. It will continue cutting rates to stimulate new-home construction but the only real beneficiary will be established dwelling prices.

Established dwelling prices to rise further.