New building activity is drying up but the massive pipeline of work yet to be completed is still making its way through the system.
The total number of homes under construction hit a record high in the June quarter as measured by the national statistics bureau.
In the June quarter, work was under way on 241,926 homes, beating the last record of 240,156 in the March quarter.
But new construction work is slowing down, with total new dwelling starts falling 2.7 per cent to 48,076.
New house building fell just 0.2 per cent, the Australian Bureau of Statistics figures revealed, whereas other types of residential dwellings - such as units - fell 3.1 per cent.
Construction industry bodies have been warning of a slowdown in new construction work as the sector battles high interest rates, soaring inflation and ongoing labour and material shortages.
Master Builders Australia expects new home construction to fall well short of the 200,000 new homes needed each year to keep up with the population growth.
However, there's still a large backlog of work still under way that commenced during the pandemic.
Bureau data released earlier in the month showed a fall in lending for housing but a bounceback in new home approvals.
Despite inflationary pressures seemingly dampening activity in the home building sector, the rising cost of living is yet to weigh down consumer spending.
Mastercard data showed spending was up across all retail categories from the COVID-affected spending patterns of a year ago but were also higher than pre-pandemic levels.
Spending across all retail categories was 32.7 per cent up on September three years ago and 25.9 per cent compared to this time last year.
