Large increases in Queensland and New South Wales drove new home sales higher for the second consecutive month during May 2017 according to the latest edition of the Housing Industry Association’s New Homes Sales Report.
During the month of May 2017, total new home sales increased by 1.1 per cent. This was helped by a 2.2 per cent increase in new detached house sales. However, geographic variations continue to persist across Australia’s different housing markets with some states seeing a substantial decline in new detached housing sales.
The results indicates how varied the Australian market is, said HIA Senior Economist Shane Garrett.
“Very robust increases in new house sales occurred in Queensland and New South Wales during May, in contrast to Victoria and WA where sharp contractions were experienced during the month,” Mr Garrett said.
“A modest contraction will continue to occur in detached house starts across Australia up until the end of the decade whilst a much bigger reduction in multi-unit commencements is anticipated to continue over the coming years as activity retreats from the unprecedented levels of recent years.”
With the Census 2016 results released this week, Mr Garrett said government policy need to focus on deliver sustainable housing solutions given that new home building is set to reduce.
“(The Census results show) the objective of meeting Australia’s housing needs over the long term is becoming increasingly challenging. With new home building set to reduce, it is important that government policies focus on allowing our industry to deliver the requisite supply of new housing in an affordable fashion,” he concluded.
Queensland experienced the largest increase in new detached house sales during the month (+31.1 per cent) followed by NSW (+16.8 per cent). The largest reduction in sales occurred in South Australia (-15.6 per cent). Reductions also affected the markets of Victoria (-14.7 per cent) and Western Australia (-3.4 per cent).
