Australia’s housing recovery is a bright spot on the economic landscape, which is dominated by concerns about the transition from Mining Investment Boom to more domestically-lead growth.
It’s not just that prices are rising and Australian home owners will feel more wealthy, and therefor hopefully spend more in the economy. But that these same price rises are driving an increased investment in housing construction throughout the country, which will help take up some percentage — hopefully a large one — of the employment slack that will emerge as mining construction and investment is past its high point.
News this morning from the Housing Industry Association (HIA) that November New Home Sales grew by 7.5%, the fastest growth rate since 2010, is another reason to believe that monetary policy is doing its job, and that the Australian economy can transition from its recent reliance on mining as the engine of growth.
HIA Chief Economist Harley Dale noted that the improved outlook was across the country and in both detached homes and units.
“Over the three months to November 2013 the volume of detached house sales increased in all five surveyed states, while the downward trend evident in multi-unit sales has now reversed due to strong monthly outcomes in both September and November of last year.”