The states where new home sales are dropping
New homes may be losing their lustre with buyers as sales saw a sharp decline in February.
There’s been a sharp decline for new home sales as the market loses its lustre.
The HIA New Home Sales Report has recorded a 5.3% fall for February, with Queensland showing the sharpest decline at 12.1%. Western Australia and Victoria were the only states that saw increases.
HIA chief economist Harley Dale said the decline was “larger than desirable”.
“HIA New Home Sales are losing some of their lustre as a downward trend becomes more firmly entrenched,” Dale said.
But Dale claimed there was no reason “to loudly ring alarm bells”.
“New home sales are down, but far from out. Over the three months to February 2016, the sale of detached houses increased by 1.8%. The sale of multi-units nudged up by 0.8% over the same period.”
Dale said it would be important to pay heed to key leading indicators in the year ahead like new home sales and building approvals.
“Stage one of a down cycle in new home building will be moderate, but signs of a sharper contraction in subsequent stages may emerge as the year progresses.”