Sales of new homes continue to flourish, according to a monthly survey of Australia’s largest home builders.
The HIA’s latest New Home Sales report shows that sales in June 2021 jumped 15.3% to be 11.2% higher in the quarter than the same time in 2019.
HIA Economist Angela Lillicrap suggests that the strength points to a significant number of new homes entering the pipeline, which should ensure activity remains elevated into 2022.
“Sales in the June 2021 quarter are below the levels experienced during the nine months of the HomeBuilder program but are stronger than the same quarter in 2019”, she says.
“Sales are also on par with the June 2018 quarter, which was a healthy year for detached home building.”
Record low interest rates and confidence in the housing market are driving demand from owner-occupiers, with robust house price growth a contributing factor.
“Households enter into a contract to build with the expectation that house prices will continue to grow and the property will be worth more when it is completed”, Lillicrap says.
The report shows, however, that the robust activity is not occurring evenly across the states.
New South Wales and Western Australia reported sales over a third higher in the June 2021 quarter compared to the same time in 2019, and sales in Queensland were 4.4% higher.
Victoria barely registered any movement (down by 0.1%), yet while South Australia had the strongest response to HomeBuilder, subsequent sales remain lower by 14.4% compared to the June 2019 quarter.