The Housing Industry Association reports that new home sales registered a modest growth in the month of October.

The HIA New Home Sales Report, a survey of Australia’s largest volume builders, reveals that total seasonally adjusted new home sales increased by 3.0 per cent in October 2014 following a flat performance in September.

HIA Chief Economist, Dr Harley Dale explained that the rise was driven by growth in detached house sales in Victoria and Western Australia.

According to Harley Dale, after a relatively sharp decline of 5.7 per cent in July, driven by both detached houses and multi-units, total new home sales have mounted a modest recovery. Though sales are still off their cyclical peak reached in April 2014, the overall volume of new home sales is currently at an elevated level, auguring well for healthy new home construction activity persisting into 2015.

Harley Dale says Australia is on track to commence a record number of homes this year with positive signals coming from three key leading indicators: HIA new home sales and ABS building approvals, which are past their peaks but remain at elevated levels; and lending for new housing, which is still trending higher and doesn’t appear to have peaked yet.

In the month of October 2014, detached house sales increased by 4.7 per cent in Victoria and 24.8 per cent in WA, and fell by 3.0 per cent in New South Wales, 7.8 per cent in Queensland and 1.7 per cent in South Australia. Over the three months to October 2014, detached house sales increased in NSW (+3.7 per cent), Queensland (+1.2 per cent) and WA (+1.7 per cent), but fell in Victoria (-13.4 per cent) and SA (-6.3 per cent).