Updating the Victorian new house sales crash

By Leith van Onselen

Here is an updated chart to my post this morning on tanking Melbourne new house sales. From the Housing Industry Association’s (HIA) October report:

The chart speaks for itself. On an annual basis, new house sales in Victoria have hit 15-year lows. And on a monthly basis, sales are at the lowest level in more than 12 years after falling by a further -12% in October.

Twitter: Leith van Onselen. Leith is the Chief Economist of Macro Investor, Australia’s independent investment newsletter covering trades, stocks, property and yield. Click for a free 21 day trial.

26 Responses to “ “Updating the Victorian new house sales crash”

  1. Janet says:

    What Melburnians need is more household debt……..

  2. bskerr2 says:

    As the creeping death of the property market bites into Victoria I wonder how it will affect other parts of the country.

    I also wonder when Asian and other foreign investors will start ditching property, make on the high dollar and get out of the market.

    • tanmedia says:

      Asian cultures typically buy new housing. I don’t want to stereotype, but that is the way it seems to work.

      • bskerr2 says:

        yes, true, how about the numbers of people coming into VIC, if job losses are on the rise maybe in time this will also have an impact as numbers of people migrating to vic slow down.

        Anyhow, seems the bubble market is looking worse and worse each day and with that news that %30 of people are walking out of development deals and i guess that is set to get worse as well it may make people think twice investing.

      • Revert2Mean says:

        I’m watching a Qld rural market, and, unbelievably, an agent friend told me yesterday that several expensive local homes on acreage were recently sold to Hong Kong buyers!

        One of the sales involved a Chinese woman breaking into tears and “shivering all over” when she inspected the home, saying that this was exactly what she and her hsband had been looking for.

        These Chinese buyers have their fingers into every market in Australia. :evil:

      • SvetlanaBabe says:

        “Unbelievably” is right! I call bull$*** on this one…

      • TheJoneses says:

        Sounds about right to me.

        Chinese Politbureau families bidding up the price of real estate beyond what working families here can afford.

        Shame on our politicians for allowing this to happen.

      • Wing Nut says:

        They’ll do anything to keep this steam pile of …. from blowing up.

  3. tanmedia says:

    The accepted understanding is that fewer new home sales results in more demand for existing houses, so prices naturally rise for existing houses.

  4. squirell says:

    and its all the worse when you consider the population was a lot less 15 years ago. So I guess its worse than its ever been. This has got to feed through into construction jobs, economy, sentiment etc. DONT BUY NOW!!! (… unless the govt thinks up some more dumb stimulus, in which case you MIGHT get lucky in the short term).

  5. Petervm says:

    Anyone know which bank has the most exposure to the Vic property market ?

  6. SoulNigga Chips says:

    UE, do you also have updated figures on the employment figures for construction until the end of October?

  7. Bubbley says:

    Interesting talk with my business bank manager this week….

    He is overwhelmed with mortgage work at the moment. Busiest he has been in a long time.
    However the loans are not for people buying property in Darwin (where we are) but people buying property out of state. He’s doing investment property’s and FIFO workers.

    He has been told by customers that they are not buying in Darwin because its too expensive compared to other areas.

  8. Pandemonium says:

    There is only one prediction for Australian housing market:
    “Who flies high, falls low!”

  9. The Patrician says:

    Why doesn’t the HIA lobby Baillieu to cut the FHB grant on existing properties?

    • Probably because it would result in overall price deflation. As such, they would rather more fuel is added to the fire via additional grants for new builds.

      • The Patrician says:

        I’m pretty sure the HIA were part of the push for the recent changes in QLD and NSW

      • The Patrician says:

        I would think HIA’s Qld and NSW based members would be more happy with their states current FHB grants arrangements than HIA’s Vic members