New home sales rebound in June
New home sales have rebounded in June, but the trend for sales remains in decline.
The Housing Industry Association (HIA) New Home Sales Report has shown an 8.2% rise for new home sales in June. The result sees new home sales end the financial year on a positive note, but HIA chief economist Harley Dale said the trend for home sales was still in “modest decline”.
“The overall profile of HIA New Home Sales is signalling an orderly correction to national new home construction in the short term, as are other leading housing indicators,” Dale said.
Dale pointed to “large geographical divergences” in the figures, with some states showing strong growth and others showing sharp declines.
“Comparing the June quarter this year to the same period last year, detached house sales are down very sharply in South Australia (-21.4%) and in Western Australia (-27.5%), yet sales are up by 17.0% in Victoria and by 7.1% in Queensland. New South Wales rounds off the detached house coverage provided by the New Home Sales report and sales are down by 7.3% on an annual basis,” Dale said.
The results cut against predictions by real estate forecaster BIS Shrapnel, which has warned that residential construction is set to plummet. Speaking to the Australian Financial Review, Dale rubbished the forecaster’s predictions.
“That's a bit different from the alarmist rhetoric from BIS Shrapnel today, that we're all going to hell in a hand basket. We've got to be careful at a delicate stage that we don't generalise too much about the home market,” he told the AFR.