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New home sales fall in Australia after four months of growth

The Housing Industry Association New Home Sales report, a survey of Australia's largest volume builders, showed that total seasonally adjusted new home sales fell by 5.3%.

There was a 4% fall in detached home sales and an 11% fall in multi unit sales which the HIA, the voice of Australia’s home building industry, described as disappointing.

Detached house sales fell by 13.7% in Victoria, by 2.8% in New South Sales and by 6.7% in South Australia. However, there were increased sales for new detached homes in both Western Australia and Queensland, up 1.9% and 0.8% respectively.

‘The data is disappointing in the context of the growth in sales over previous months. The broadly based decline in activity during February is a reminder of how delicate the nascent recovery in the housing industry really is,’ said HIA senior economist Shane Garrett.

However, he pointed out that the in a broader context the overall direction of activity is still quite encouraging. ‘New home sales are up strongly over the last three months in almost all states, in terms of both houses and multi units,’ he explained.

‘Nonetheless, February’s data emphasise how far housing market activity has fallen from the levels of just three years ago. The industry is struggling in the current economic environment and strong policy measures will be required to bring market activity back up to levels consistent with Australia’s long term requirements,’ he added.

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