HAVE WE PEAKED?

FRESH reports from the Housing Industry Association (HIA) could suggest a turning point in a peaking housing market.

Following its quarterly state-by-state reports released this week, the HIA has posed a key question whether the most recent decline in approvals is the beginning of a broader trend, or it's just an aberration to continuing growth.

Total new home building approvals across the nation have trended down 4.8 per cent in the June quarter this year compared to the year prior.

This comes after news Australians started on building more new homes in the year to March 2015 than in any other twelve month period on record. The total figure was 204,096 from a population of 23 million people.

In fact, the three months to March 2015 reflected particularly high times - 'easily' a record quarterly level of 57,000 dwellings were approved.

New dwelling commencements are now expected to decline sharply, 11.5 per cent in 2016 and 5.8 per cent in 2016/17.

"The current housing cycle is characterised by markedly different conditions across state and territory borders," reports the HIA.

"The near-recessionary conditions afflicting the home building markets in Tasmania and South Australia provide an obvious contrast to the buoyant conditions in NSW and Victoria.

"Meanwhile, the investment cycle of the resource sector is playing a pivotal role in conditions in Western Australia, Queensland and the Northern Territory.

"Finally, the housing market in the ACT has been affected by the dynamics of federal politics over the last five years."

The HIA admits that it speculated approvals had peaked this time last year, however, at that time it noted the possible occurrence of a second wind due to factors such as record-low interest rates.

This wind did sweep the industry - and now, it's not so likely interest rates can keep dramatically falling.

The HIA is standing by its previous estimate that the cash rate will remain at 2 per cent before starting to increase during the second half of 2016.