Australian new home sales soar to a four-year high in March

Getty

Reflecting the surge in building approvals seen over the past year, new home sales are running hot.

According to the HIA, new home sales jumped by 4.4% in March taking the annualised rate to levels last seen in early 2010.

Multi-unit sales soared by 11.3% while sales for detached homes increased by a smaller, yet still impressive 2.6%.

The increase in detached home sales was driven by a 5.9% increase in Victoria with those in New South Wales and Western Australia rising by 4.2% apiece. Offsetting those gains, sales in South Australia and Queensland fell by 5.8% and 2.3% respectively.

Commenting on the impressive result, here’s what HIA economist Diwa Hopkins had to say:

“The monthly rise in both the detached and multi-unit segments of the market is an encouraging result. However, the broader trend is that growth over the past year has been driven by multi-unit sales, while detached house sales have tracked sideways. HIA welcomes yesterday’s reduction to the official cash rate, a decision which has arrested much of the uncertainty around monetary policy. Lower lending rates will provide added support to residential construction activity, which is emerging as a key area of growth mitigating the effects of the downturn in mining investment and construction.”

While it will be hard to top the 4.4% increase seen in March, with building approvals – particularly for multi-dwelling units – continuing to soar, it’s likely that strong sales results will continue for the foreseeable future.

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.