Key points: 

• Nationally, the current residential pipeline is holding up but it is softer in NSW
• NSW Building Approvals point to a worrying outlook looming for home builders. 
• The value of residential work done rose nationally to more than $45b. 
• The impact of interest rate rises and fuel price escalations is yet to be felt. 

The latest Building Activity data for June quarter 2026 has been released by the ABS. It paints an interesting picture. 

As an indicator of the current pipeline of work, the residential commencements and completions remained strong nationally, However, in NSW new housing commencements seem to have peaked in the December quarter of 2025 and have fallen lower in both the March and June quarters of 2026. 

But don't be tempted to only focus on the current pipeline because new Building Approvals data are reducing in number which indicates less demand for building in the later months of this year and in 2027. 

Building Activity - the National Picture

In seasonally adjusted terms:

• Total dwelling commencements rose 7.0% to 52,201.
• New private house commencements rose 11.6% to 31,707,
• Private "other residential" (units/townhouses) commencements fell 0.1% to 19,126,
• The value of total building work done rose 1.1% to $45.8b.
• Completions also rose with total dwellings completed up 5.8% to 47,168, with private other residential completions up 13.9%.
• There are 248,733 dwellings under construction, of which 95,447 were new houses.
   

Building Activity - The NSW Picture 

•  New residential starts were down in NSW, and commencements fell about 5.5% over the quarter and about 1% over the year.
• NSW was the only one of the five large states where starts fell this quarter (June 2026). . 
• Our completion rate in NSW is strong with about 13,300 homes in the June quarter, up roughly 30% on the March quarter and about 43% on a year ago.
• This is a very strong result historically for NSW, but it's not good news. It means projects that started in 2024/2025, especially apartments, are being finished. It is not an indication of a strong pipeline of activity continuing.  
• The NSW Government's reforms to cut red tape have had an impact with NSW recording roughly 51,900 starts and 49,300 completions in 2025/26 which is an improvement on the previous year.  
• NSW approvals rose 13.2% in June, which could feed future starts, but the most recent monthly figures showed NSW total dwelling approvals falling 17.3%. The impact of interest rate rises is yet to be felt. 
• The bottom line is that NSW is clearing the existing pipeline of projects more efficiently, but there is no replenishment of the pipeline in evidence for the next several months at least. 
   

Residential Building Commencements & Completions For NSW in the June 2026 compared to the previous year:

Snapshot of Construction Indicators

Leading Indicators of Future Construction Activity: 

• Building approvals
• Development applications
• Housing finance commitments
• New home sales
• Business investment intentions
• Tender activity

Concurrent Indicators roughly reflecting the current economic conditions: 

• Dwelling commencements
• Construction employment
• Capacity utilisation in the construction sector

Lagging Indicators. Construction activity that reflects decisions made months or years earlier: 

• Construction work done (ABS)
• Dwelling completions
• Building activity volumes
• Engineering construction activity

Engineering Construction Activity is the leading lagging indicator for the civil construction sector. Each quarter it tells us:

• What is currently being built.
• The pipeline of projects already underway.
• Whether previously approved investment is translating into physical work.

As a lagging indicator, Building Activity reflects the investment decisions made by individuals, corporate or non-corporate entities in the past. It points to the current pipeline of work. 

In the case of engineering (civil)  construction activity and longer running commercial/industrial projects, this data can also be a near-term indicator of construction demand and employment because of the duration of projects underway.