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INTRODUCTION

1 This publication contains preliminary estimates from the quarterly Building Activity Survey of the number of dwelling units commenced during the current quarter and revised estimates for the previous two quarters. More comprehensive and updated results will be available shortly in Building Activity, Australia (cat. no. 8752.0).

2 The statistics were compiled on the basis of returns collected from builders and other individuals and organisations engaged in building activity. From the March quarter 2002, the quarterly survey consists of a sample survey of private sector residential building jobs valued at $10,000 or more and a complete enumeration of all such public sector residential building jobs. Estimates in respect of commencements of private sector dwellings and total dwellings are therefore subject to sampling variability. The relative standard errors for these estimates are shown in paragraph 12. Also, some returns containing jobs not known to have commenced are not received in time for inclusion in these estimates. Allowance is made for a proportion of these jobs, based on past experience, to have commenced. Estimates in this issue are therefore subject to revision.

3 The use of sample survey techniques in the Building Activity Survey means that reliable estimates of the number of private sector dwelling commencements are generally available only at state, territory and Australia levels. Although subject to higher relative standard errors, a range of sub-state estimates of dwelling commencements may be available. Reliable small area data are available for the Northern Territory, which has been completely enumerated since the June quarter 1991. Detailed data on Building Approvals, based on information reported by local government and other reporting authorities, are available for regions below state and territory level from the Building Approvals series compiled by the ABS.

DEFINITIONS

4 A building is defined as a rigid, fixed and permanent structure which has a roof. Its intended purpose is primarily to house people, plant, machinery, vehicles, goods or livestock. An integral feature of a building’s design, to satisfy its intended use, is the provision for regular access by persons.

5 A dwelling unit is defined as a self-contained suite of rooms, including cooking and bathing facilities and intended for long-term residential use. Units (whether self-contained or not) within buildings offering institutional care, such as hospitals, or temporary accommodation, such as motels, hostels and holiday apartments, are not defined as dwelling units.

6 A residential building is defined as a building predominantly consisting of one or more dwelling units. Residential buildings can be either houses or other residential buildings.

• A house is defined as a detached building predominantly used for long-term residential purposes and consisting of only one dwelling unit. Thus, detached granny flats and detached dwelling units such as caretakers’ residences associated with non-residential buildings are defined as houses for the purpose of these statistics.
• An other residential building is defined as a building which is predominantly used for long-term residential purposes and which contains (or has attached to it) more than one dwelling unit (e.g. includes townhouses, duplexes, apartment buildings, etc.).

8 Conversions, etc. Dwelling units can also be created as part of alterations and additions to existing buildings (including conversions to dwelling units) and as part of the construction of non-residential buildings. Such dwelling units are referred to in this publication under the heading of Conversions, etc.

9 Commenced. A building is regarded as commenced when the first physical building activity has been performed on site in the form of materials fixed in place and/or labour expended (this includes site preparation but excludes delivery of building materials, the drawing of plans and specifications and the construction of non-building infrastructures, such as roads).

10 Ownership. The ownership of a building is classified as either public sector or private sector according to the sector of the intended owner of the completed building as evident at the time of approval. Residential buildings being constructed by private sector builders under government housing authority schemes whereby the authority has contracted, or intends to contract, to purchase the buildings on or before completion, are classified as public sector.

RELIABILITY OF THE ESTIMATES

11 The estimates in this publication are based on a sample survey of private sector residential building jobs and a complete enumeration of such public sector jobs. Because data are not collected for all private sector residential building jobs, estimates are subject to sampling variability. Relative standard errors give a measure of this variability and therefore indicate the degree of confidence that can be attached to the data.

12 Relative standard errors for the number of dwellings commenced in the December quarter 2003 are given below. There is 67% confidence that the actual number would be within one standard error of the sample estimate, and 95% confidence that it lies within two standard errors.

RELATIVE STANDARD ERRORS, December Quarter 2003
	NSW	Vic.	Qld	SA	WA	Tas.	NT	ACT	Aust.
	%	%	%	%	%	%	%	%	%
New private sector houses	3.7	3.9	3.5	3.5	3.5	2.7	-	3.0	1.7
Total new other dwellings	2.3	1.7	1.0	2.9	0.8	-	-	-	0.9
Total dwellings	2.3	2.8	2.3	2.6	2.7	2.5	-	1.4	1.2
- nil or rounded to zero (including null cells)

14 Since seasonally adjusted statistics reflect both irregular and trend movements, an upward or downward movement in a seasonally adjusted series does not necessarily indicate a change of trend. Particular care should therefore be taken in interpreting individual quarter-to-quarter movements. The seasonally adjusted series for total dwellings for Australia and each state and territory has been produced by summing the respective seasonally adjusted series for each of "new houses", "new other residential dwellings" and "conversions, etc". However, the states and Australia are adjusted independently, which means that the sum of the adjusted state series may not add to the adjusted Australian total.

15 From the June quarter 2003, the seasonally adjusted estimates are produced by the concurrent seasonal adjustment method which takes account of the latest available original estimates. The concurrent seasonal adjustment methodology replaces the forward factor methodology previously used, when seasonal factors were only revised following an annual re-analysis. The concurrent method improves the estimation of seasonal factors and, therefore, the seasonally adjusted and trend estimates for the current and previous quarters. As a result of this improvement, revisions to the seasonally adjusted and trend estimates will be observed for recent periods. In most instances, the only noticeable revisions will be to the previous quarter and the same quarter of a year earlier.

16 A more detailed review of concurrent seasonal factors will be conducted annually, generally prior to the release of data for the December quarter.

TREND ESTIMATES

17 Seasonally adjusted series can be smoothed to reduce the impact of the irregular component in the adjusted series. This smoothed seasonally adjusted series is called a trend estimate.

18 The trend estimates are derived by applying a 7-term Henderson moving average to the seasonally adjusted series. The 7-term Henderson average (like all Henderson averages) is symmetric but, as the end of a time series is approached, asymmetric forms of the average are applied. Unlike weights of the standard 7-term Henderson moving average, the weights employed here have been tailored to suit the particular characteristics of individual series.

19 While the smoothing technique described in paragraphs 17 and 18 enables trend estimates to be produced for recent quarters, it does result in revisions to the estimates for the most recent three quarters as additional observations become available. There may also be revisions because of changes in the original data. For further information, see Information Paper: A Guide to Interpreting Time Series-Monitoring Trends: an Overview (cat. no. 1348.0) or contact the Assistant Director, Time Series Analysis on Canberra 02 6252 6540 or email .

ACKNOWLEDGMENT

20 ABS publications draw extensively on information provided freely by individuals, businesses, governments and other organisations. Their continued cooperation is very much appreciated: without it, the wide range of statistics published by the ABS would not be available. Information received by the ABS is treated in strict confidence as required by the Census and Statistics Act 1905.

RELATED PRODUCTS

21 Users may also wish to refer to the following publications which are available from ABS Bookshops:

Building Activity, Australia, cat. no. 8752.0, quarterly
Building Approvals, Australia, cat. no. 8731.0, monthly
Construction Work Done, Australia, Preliminary, cat. no. 8755.0, quarterly
House Price Indexes: Eight Capital Cities, cat. no. 6416.0, quarterly
Housing Finance for Owner Occupation, Australia, cat. no. 5609.0, monthly
Producer Price Indexes, Australia, cat. no. 6427.0, quarterly
Private Sector Construction Industry, Australia, 1996-97, cat. no. 8772.0.

ABS DATA AVAILABLE ON REQUEST

23 As well as the statistics included in this and related publications, the ABS may have other relevant data available on request. Inquiries should be made to the National Information and Referral Service on 1300 135 070.