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Sales of new homes in the three months to July 2024 were significantly stronger than the year prior.
Research from the Housing Industry Association (HIA) revealed an 11.1 per cent boost in new home sales compared to last year, signalling an uptick in residential construction.
HIA economist Maurice Tapang noted that while new home sales “fell back marginally in July” by 4.1 per cent, sales this year “remained stronger than at the same time in the previous year”.
“This is consistent with our expectations that detached home building will pick up pace in the second half of 2024,” said Tapang.
New home sales varied substantially from state to state, with Queensland seeing the largest increase.
Compared to last year, Queensland saw a massive 60.1 per cent increase in new home sales in the three months to July 2024. South Australia also saw a substantial year-on-year uplift, with 55.8 per cent more new home sales compared to the same period in 2023.
Gains were more moderate in NSW at 17.5 per cent, while Victoria saw a 13.3 per cent decrease year-on-year.
“Sales of new homes in New South Wales and Victoria are continuing to bounce along the bottom of their respective cycles.”
“The rise in interest rates hurts these markets, particularly in Sydney and Melbourne, more significantly due to the higher costs of lands,” Tapang explained.
“These sales figures suggest that the improved number of homes commencing construction across Australia will be driven by smaller markets outside of Sydney and Melbourne,” he said.
In Western Australia, where housing demand from locals and interstate investors remains strong, new home sales increased slightly by 1.4 per cent, but Tapang noted that demand remains unaffected.
“New home sales in Western Australia remain elevated, despite a fall in recent months, as this market is constrained only by the capacity of the industry, not demand,” he stated.
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