The Housing Industry Association reports that May registered the first fall in new home sales since the beginning of 2015.
According to the HIA New Home Sales Report, a survey of Australia’s largest volume builders, the four-month winning streak ended in May 2015 with total seasonally adjusted new home sales falling by 2.3 per cent.
HIA Chief Economist Dr Harley Dale explained that the decline was driven by a 5.1 per cent dip in detached house sales, reflecting weaker monthly demand in four out of the five states surveyed.
However, the report also reveals an aggregate profile of healthy new home building conditions in 2015. According to Harley Dale, the mature stage of the new home building cycle primarily reflects further momentum in the ‘multi-unit’ sector, together with persistence of healthy conditions in New South Wales and Victoria.
Harley Dale noted that new sales of multi-units increased by 7.6 per cent during the month to a new record level, with sales volumes up by 26.7 per cent over the three months to May. Meanwhile strength in detached houses sales is evident in NSW and Victoria, with growth in the May 2015 quarter of 5.2 per cent and 6.2 per cent, respectively.
He added that leading indicators such as new home sales and ABS building approvals will provide vital clues in the coming months of the sustainability and composition of the upcycle in new home building in 2015/16.
In the month of May 2015 detached house sales increased by 3.3 per cent in Queensland, but fell by 2.3 per cent in NSW, 9.9 per cent in Victoria, 5.2 per cent in South Australia, and 8.1 per cent in Western Australia. In the May 2015 quarter, detached house sales increased in NSW (+5.2 per cent) and Victoria (+6.2 per cent). Sales fell over the three month period in SA (-8.1 per cent), Queensland (- 7.5 per cent), and WA (-1.3 per cent).