By
The robust housing market turnout for new properties over the recent quarter could signal a further growth in the level of dwelling supply in the coming months, according to the Housing Industry Association (HIA).
New home sales over the June quarter increased 15.3%. While the level of activity during the quarter was below the one experienced during the nine months of the HomeBuilder program, it is still stronger the during the same quarter in 2019.
Furthermore, the turnout for the quarter was similar to the same period in 2018, which was a strong year for detached home building.
"The strength of new home sales nationally suggests that there will be a significant number of new homes entering the pipeline post HomeBuilder which will ensure activity remains elevated into 2022," said Angela Lillicrap, economist at the HIA.
In fact, recent figures show that the number detached dwelling approvals in May remained elevated, up by 63.1% from last year.
Lillicrap said the favourable market conditions given the record-low interest rate and the rising market confidence are driving the demand from would-be owner-occupiers.
"Strong house price growth is also a contributing factor. Households enter into a contract to build with the expectation that house prices will continue to grow and the property will be worth more when it is completed," she said. “This strong volume of sales will continue to pull the national economy forward."
However, it is crucial to note that the recent growth in sales was not even across the states. During the quarter, New South Wales and Western Australia registered around 30% growth in sales. On the other hand, Victoria and South Australia lagged, with the latter reporting a 14.4% decline from last year.
