The latest result for the HIA New Home Sales Report, a survey of Australia’s largest volume builders, highlights the on-going strength of the new home building sector.
“Monthly sales volumes remained strong throughout 2014, following the recovery that characterised 2013,” commented HIA Economist, Diwa Hopkins. “The number of sales in 2014 was 14.4 per cent higher than in 2013.”
For the month of December 2014, total seasonally adjusted new home sales fell by 1.9 per cent, but sales increased by 4.9 per cent in the December quarter. The December monthly outcome reflected a drop of 9.2 per cent in ‘multi-unit’ sales and what was effectively a flat result (-0.2 per cent) for detached house sales.
“A key change in conditions to the residential construction sector in 2015 is the February cut to the official cash rate to a new historic low,” said Ms Hopkins. “However, it should be noted that this cut was made in the context of a mooted tightening of lending conditions in parts of the housing market.”
“This year will be another healthy one for the national new home building sector,” added Ms Hopkins. “The two key leading indicators of new home building activity, new home sales and residential building approvals, both saw increases during the December quarter of 2014.This is a clear indication that actual residential construction activity will rise in the current early months of 2015, which is good news for the broader domestic economy in addition to the housing sector.”
In the final month of 2014 detached house sales increased by 2.8 per cent in Western Australia and by 2.6 per cent in Queensland. Detached house sales declined by 5.3 per cent in South Australia, 2.6 per cent in Victoria and 1.4 per cent in New South Wales. During the December 2014 quarter, sales increased by 13.4 per cent in Western Australia, 11.6 per cent in Queensland and 2.7 per cent in Victoria. Meanwhile, sales declined by 10.3 per cent in New South Wales and by 7.5 per cent in South Australia.