A new report from Housing Industry Australia (HIA) has found that sales of new homes around Australia are continuing to decline, continuing a trend that commenced in 2015.
The latest HIA New Home Sales Report shows that in September 2017, new home sales declined by 6.1% cross the market. A decline of 4.5% was recorded for new detached house sales, while new multi-unit sales saw a 16.7% decline.
HIA senior economist, Shane Garrett, said that the decline in home sales over the past 18 months reflects the slowing in output across the economy and is a guide to short term activity in the residential building industry.
“New home sales is a leading indicator of approvals data and shows that building activity peaked in March 2016 following the longest ever upturn in new home building.”
“This process of adjustment will involve a sizeable reduction in building activity on the ground. We expect that activity will bottom out sometime in 2019 with a recovery then setting in – assuming the economy reverts to its long-term average growth rate of around 3 per cent.”
Looking at the results state by state, only NSW saw growth in new detached house sales in September 2017, with a 3.7% improvement since August. The largest reduction of -15.1% was recorded in Western Australia, followed by Queensland with -8.7%. New detached house sales also fell in Victoria (-2.3%) and SA (-1.7%) during September.
The declines recorded in HIA report follow stats recently released by CoreLogic that saw construction activity around Australia at record high levels, but housing turnover approaching the record low.