New home sales dropped back last month after hitting their highest level in two years.
The Housing Industry Association says total seasonally adjusted new home sales fell by 3.8 per cent in October 2013 following a rise of 6.4 per cent in September.
However, the HIA New Home Sales report, a survey of Australia’s largest volume builders, says we shouldn’t read too much into the dip.
Chief Economist Harley Dale says that over the three months to October the volume of detached house sales increased in all five surveyed states.
“The downward trend evident in multi-unit sales since late last year looks to be reversing,” he says.
“That’s a good profile for a leading indicator of new home building activity heading into the end of the year.”
The sales of multi-units turned in growth of 1.4 per cent in October, a very good result given the 19.9 per cent jump recorded for the previous month.
Chief Economist Harley Dale:
“It will be important to observe a second leg of upward momentum to new home sales in the months ahead. This outcome would signal further growth in new residential construction activity in 2014 in what will remain a very low interest rate environment.”
October state numbers for private detached house sales:
- Increased by 17.4 per cent in South Australia
- Rose by 3.3 per cent in Queensland
- Fell in October in New South Wales (-4.6 per cent)
- Victoria (-13.2 per cent)
- Western Australia (-1.2 per cent)