A record year for building permits

During 2020/21, Victoria’s building industry recorded its highest level of building permit approvals in the past decade.

Building permit approvals totalled 123,330 in 2020/21, 18 per cent more than the previous financial year (104,560) and 13 per cent more than 2018-19 (109,396).

The largest increase in approvals was in regional Victoria, where a 32 per cent spike in the number of building permit approvals was seen.

Of all permits issued, those for domestic building increased more than 22 per cent, with about 19,500 more permits issued in 2020-21 than in 2019/20.

The number of permits issued for residential (apartments, aged care, hotels/motels), retail, hospital/healthcare and public buildings each decreased more than 10 per cent.

New building work accounted for more than 62 per cent of all building permits in 2020/21, with the number of permits issued for this work 24 per cent greater than a year ago.

Re-erection work experienced the steepest decrease in permit activity, with 28 per cent fewer building permits issued for this work in 2020/21.

Regional Victoria leads the way

By region, the Gippsland area had 9560 building permit approvals in 2020-21, compared to 6859 in 2019-20, a 39 per cent year-on-year increase.

The North East, North West and South West regions all saw their building permit approval figures rise by more than 30 per cent in the space of a year.

There was also plenty of building activity in Outer Melbourne, with 51,422 building permit approvals in 2020/21, a 17.7 per cent increase compared to 2019-20 (43,680).

As the number of building permits issued increased, so did the cost of building works.

Building Permit Activity

Cost of works increased by $2.8 billion in 2020/21

In Victoria, total cost of works increased from $39.1 billion in 2019-20 to $41.9 billion in 2020-21.

The biggest cost of works increases was also seen in regional Victoria, with Gippsland leading the way with a 45 per cent year-on-year cost of works increase from $1.18 billion in 2019/20 to $1.71 billion in 2020/21.

By building use, the cost of works for new building work was valued at $34.6 billion, an 11.6 per cent increase compared to 2019-20.

Extension ($1.8 billion) and demolition ($577 million) cost of works increased 14 and 20 per cent respectively in 2020/21 compared to 2019/20.

The Federal Government’s HomeBuilder Grant Scheme further supported the building industry, generating more than 35,000 applications from Victoria, with more than 29,000 of these for new builds.

If you’d like to know more about the Building Permit Activity Data the VBA collects, we have a range of datasets and statistics about our functions and services available here.