Building approvals recovered in June after a sharp drop in May, but multi-unit approvals remained well down on mid-2008 levels, according to the HIA.

Unit approvals jumped by 28.1 per cent in June following a 39 per cent drop in May.

"Multi-unit approvals fell by 8 per cent in the June 2009 quarter and were down by 36 per cent compared to the June 2008 quarter. Federal programs such as the Social Housing Initiative and the National Rental Affordability Scheme have a vital role to play in boosting the stock of new dwellings. It will be important to see evidence of renewed private investor interest in new residential property, something that remained lacking in the first half of 2009," said HIA chief economist, Harley Dale.

Detached house approvals rose by 4.7 per cent in the month and nearly 12 per cent over the June quarter.

The number of seasonally adjusted residential dwelling approvals increased in June by 3.4 per cent in NSW, 17.4 per cent in Victoria, 11.3 per cent in South Australia and 21.1 per cent in Western Australia. Dwelling approvals fell by 1.9 per cent in Queensland and 7.5 per cent in Tasmania. Approval numbers increased in both the Northern Territory and the ACT.