Building approvals
Building approvals data are out. Not hard to see why there’s a plausible shortage of houses, by number; we just aren’t building all that many, given population growth.
However apartments are higher, such that the total has grown (otherwise we’d see markedly stronger rental growth) overall.
By value of course, things go up over time. Given the additional stimulus of the now expired Homebuilder, and impact of prior rate cuts, have mostly washed through, expect some undershoot.
For building materials companies, the next year should have pretty strong activity as the order books are worked through.
However, the undershoot is a threat, and as such we prefer to look for value within the sector (and own ABC in our direct equity portfolios).
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