New home sales in Australia ended 2012 strongly as property market bounced back

New home sales in Australia increased 6.2% in December, the third consecutive monthly rise, but are still 12.7% lower than the last quarter of 2011.

The latest data from the Housing Industry Association, the voice of Australia’s residential building industry, shows that detached house sales increased by 7.1% in New South Wales, by 6% in Victoria, by 3.8% in Queensland, and by 12.2% in Western Australia. But sales fell by 1.8% in South Australia.

Over the December 2012 quarter detached house sales increased by 14.4% in New South, by 9.3% in South Australia and by 2.5% in Western Australia. They fell by 8.4% in Victoria and were down 5.5% in Queensland.

‘The promising headline rise in December was driven by both detached house and multi unit sales. Furthermore, if we look at the under performing sector in 2102 which was detached houses, the December improvement was broad based as sales increased in all but one of the surveyed states,’ said HIA economist, Geordan Murray.

‘However, the overall result for 2012 leaves plenty of room for improvement. Detached house sales were weak throughout the year and compared with 2011 were down by 22.7%,’ he explained.

‘On the other hand, multi-units sales were the star performer of 2012. They recovered from the record lows endured in 2011 and increased by 24.1% over 2012,’ he added.

Looking ahead the HIA hoped that further signs of an impending new home building recovery emerge in coming months. ‘However, it remains the case that lower interest rates alone will not deliver a recovery of the magnitude required by Australia’s economy and population,’ said Murray.

Meanwhile the latest figures from Australian Property Monitors show that overall the residential property market in Australia bounced back in 2012 with the median house price rising by 2.1%.

Prices increased in capital cities in all states in the last quarter of the year, led by Hobart at 4.7%, followed by Darwin at 2.7%, Perth at 2.5%, Melbourne at 2.4%, Canberra at 2.1%, Sydney at 2%, Adelaide at 0.8% and Brisbane at 0.3%.For Brisbane it was the first growth after months of price falls and the city ended the year with prices down 0.5%. Adelaide was also in negative territory with prices down 0.6%. Overall during the year Perth was the strongest housing market with prices up 6.1% year on year.

Home buyers pushed the Sydney median house price over $650,000 for the first time to a record $656,415 over the December quarter. The firm said that Sydney has again clearly illustrated the resilience of its housing market with house prices rising by 3.4% over 2012.

All other capitals cities remain below their previous median house price peaks although on current trends Perth, Canberra and Darwin can be expected to achieve their record house prices sometime in 2013.

Apartments performed well in 20102 with the national median unit price rising by 2.1% led by Sydney with an increase of 5.6% to a record $475,314 over the December quarter. Melbourne recorded its first quarterly rise in median unit prices for two years, up by 1% but prices remain 2.2% down over the year.

In Brisbane unit prices weakened over the December quarter falling by 2.7% and were down 3.2% over the year. Perth unit prices rose by 3.4% over the quarter to be up by 6% year on year.


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