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.