New home sales lift in Au­gust – but still trend­ing down

Australasian Timber - - ASSOCIATIONS -

New home sales in­creased by 9.1% in Au­gust month as a re­sult of very strong re­sults in Vic­to­ria and West­ern Aus­tralia, how­ever, over the year sales have con­tin­ued to slow ac­cord­ing to HIA’s Prin­ci­pal Econ­o­mist, Tim Rear­don.

The HIA New Home Sales re­port - a monthly sur­vey of the largest vol­ume home builders in the five largest states – pro­vides a lead­ing in­di­ca­tor of build­ing ap­provals and ac­tiv­ity in the build­ing in­dus­try.

“The jump in sales in July con­firms our fore­cast of a slow­down in build­ing ac­tiv­ity through un­til 2018/19. The in­crease in sales in Au­gust off­sets larger de­clines in sales in re­cent months, but it is not suf­fi­cient to re­verse the de­cline in sales that is ev­i­dent since early 2016.”

“Re­sults in July and Au­gust have been af­fected by gov­ern­ment in­ter­ven­tions in NSW and Vic­to­ria which have seen first home-buy­ers re­turn­ing to the new home mar­ket.

“Vic­to­ria has seen record num­bers of new build­ing ap­provals and new home sales are con­tin­u­ing to drive even higher. Strong pop­u­la­tion growth and em­ploy­ment growth, for­ti­fied with en­hanced first home buyer in­cen­tives, is pro­long­ing the boom in build­ing ac­tiv­ity.”

For the three months to Au­gust com­pared with the same pe­riod last year, house sales in Vic­to­ria are 15.7% higher and up by 9.2% in South Aus­tralia.

Over the same pe­riod, sales de­clined in Queens­land (-7.3%), WA (-15.4%), NSW (-17.4%) and Queens­land (-37.9%).

“The trend in new home sales con­tin­ues to pro­vide a strong lead­ing in­di­ca­tor of the trend in res­i­den­tial build­ing ap­proval fig­ures from the ABS as can be seen in the chart be­low,” Mr Rear­don said.

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