Sales of new homes have rebounded over the last year, according to new figures released this week by the Housing Industry Association (HIA).
The latest HIA New Home Sales report shows that new home sales in the three months to July 2024 were 11.1 per cent higher than at the same time last year.
HIA Economist Maurice Tapang remarked that although new home sales dropped back marginally by 4.1 per cent in July, they remain stronger than at the same time in the previous year.
“This is consistent with our expectations that detached home building will pick up pace in the second half of 2024”, Tapang added.
Queensland saw a 15.6 per cent increase in new home sales in July 2024 compared to the previous month. This leaves sales over the past three months 60.1 per cent higher than at the same time the previous year.
Sales in South Australia were 55.8 per cent higher in the three months to July 2024 than at the same time in the previous year, despite a monthly decline.
New home sales in Western Australia remain elevated, despite a fall in recent months, as this market is constrained only by the capacity of the industry, not demand. Sales in New South Wales and Victoria, however, are continuing to bounce along the bottom of their respective cycles.
Tapang believes the rise in interest rates is hurting these markets, particularly in Sydney and Melbourne, more significantly due to the higher costs of land.
“These sales figures suggest that the improved number of homes commencing construction across Australia will be driven by smaller markets outside of Sydney and Melbourne”, he said.
New home sales in the three-month period to July 2024 increased by 60.1 per cent in Queensland compared to the same time in the previous year, followed by South Australia (up 55.8 per cent), New South Wales (17.5 per cent), and Western Australia (1.4 per cent) which is coming off an already-higher base. Victoria recorded a 13.3 per cent decline over the same period.
*The HIA New Home Sales report is a monthly survey of the largest volume home builders in the five largest states and is a leading indicator of future detached home construction.