Australian new home sales dipped fractionally in July with the HIA reporting a decline of 0.4%.
Despite the fall, the second in three months, sales remain high by historical standards.
Multi-unit sales fell by 4.2%, overshadowing a 0.7% increase in detached home sales.
As the chart above suggests, while high by historical standards, it appears that cyclical peak for new home sales occurred in April of this year.
“New home sales are spending mid 2015 drifting along at a historically high level. It appears that the cyclical peak for total new home sales occurred in April, but the subsequent downward trend is very mild,” said Harley Dale, chief economist at the HIA.
“Key leading indicators of home building, including HIA New Home Sales, suggest little prospect for further growth in new home construction in 2015/16,” added Dale.
Despite the belief that sales may have peaked, Dale believes the report, along with recent ABS building approvals reports, points to the likelihood of another healthy year for new home construction in the 2015/16 financial year.
Looking ahead, it will be interesting to see what, if any, tighter restrictions on investor home loan lending will have on sales levels in the second half of 2015.