HIA Hunter executive director Craig Jennion said the Australian Bureau of Statistics data, which indicates a seven per cent drop across the broader Hunter's local government areas in the year to December, was no reason to panic.

"Despite the slight deterioration in new home approvals in 2019, it was a solid result considering the headwinds the industry faced," he said.

"In total 4598 approvals were issued for new dwellings across the Hunter during 2019, a decrease of seven per cent from the decade high recorded in 2018."

Mr Jennion pointed to a mix of tighter financing, the banking royal commission, elections and house price drops as blows to market confidence in the last period.

Newcastle, Lake Macquarie and Maitland contributed 77 per cent of the approvals in 2019, the data shows.

Among those three only Lake Macquarie went backwards, with the data stating 2018's 1431 approvals fell to 957 last year.

Lake Macquarie City Council's acting manager development assessment and certification Elizabeth Lambert said that figure was offset by a record 1042 lots in the area hitting the market.

"Urban releases in Cooranbong, Cameron Park and Edgeworth and Teralba released 163, 209 and 102 lots respectively," she said.

"The past calendar year also saw the start of a new major release area at Wyee, with the first four stages yielding 136 lots.

"The former Pasminco site at Boolaroo was the second-highest contributor with 148 lots.

"Subdivision approvals in 2019 will equate to residential development worth up to $125 million, with residential lots accounting for most of this value."

Lake Macquarie's drop in new building approvals was the region's second-highest in the Australian Bureau of Statistics data behind Singleton, who went from 90 to 45 approvals.

Cessnock (20 per cent), Port Stephens (10 per cent) and Scone (31 per cent) all recorded declines on the 2018 figures.

Newcastle rose from 1373 approvals in 2018 to 1514 last year, while Maitland had 182 more approvals last year than in 2018.

"Pleasingly, large percentage increases in total dwelling approvals continued to occur in regional locations of the Hunter, notwithstanding off a low base," Mr Jennion said.

"Gloucester was the strongest, up 71 per cent, followed by Muswellbrook up 67 per cent, and Dungog up 10 per cent.

"Looking ahead, we are forecasting residential building activity to soften further in the short term before a gradual pick up in 2021.

"Housing in the Hunter remains affordable for average households and market conditions look set to support continued demand for new homes locally in the near future."

Cessnock

676 (12 months to: Dec 2018)

541 (12 months to: Dec 2019)

-20% change

Lake Macquarie

1431 (12 months to: Dec 2018)

957 (12 months to: Dec 2019)

-33% change

Maitland

914 (12 months to: Dec 2018)

1096 (12 months to: Dec 2019)

20% change

Newcastle

1373 (12 months to: Dec 2018)

1514 (12 months to: Dec 2019)

10% change

Port Stephens

324 (12 months to: Dec 2018)

291 (12 months to: Dec 2019)

-10% change

Dungog

40 (12 months to: Dec 2018)

44 (12 months to: Dec 2019)

10% change

Singleton

90 (12 months to: Dec 2018)

45 (12 months to: Dec 2019)

-50% change

Muswellbrook

9 (12 months to: Dec 2018)

15 (12 months to: Dec 2019)

67% change

Scone

16 (12 months to: Dec 2018)

11 (12 months to: Dec 2019)

-31% change

Gloucester

14 (12 months to: Dec 2018)

24 (12 months to: Dec 2019)

71% change

Great Lakes

46 (12 months to: Dec 2018)

60 (12 months to: Dec 2019)

30% change