New home sales in partial recovery

From the HIA comes its latest new homes sales report:

The monthly HIA survey of Australia’s largest volume builders reveals that total seasonally-adjusted new home sales mounted a partial recovery in August 2016.

“HIA New Homes Sales fell by a rather hefty 9.7 per cent in July 2016, but then increased by 6.1 per cent in August,” said HIA Chief Economist, Dr Harley Dale.

“Sales of new detached houses and ‘multi-units’ didn’t rebound sufficiently in August to offset the decline in July. These latest New Home Sales figures therefore don’t paint a stellar picture of an August recovery – following as they do a big drop in July, but unless you’re a pessimist looking for a large black hole then this latest update is a long way from a downbeat story.”

The number of seasonally-adjusted detached house sales increased by 2.9 per cent in August 2016, following a decline of 7.4 per cent in July. However, ‘multi-unit’ sales dropped by 17.3 per cent in July before recovering by 17.8 per cent in August.

“Australia is in the midst of the longest and biggest new home building cycle in the nation’s history,” Harley Dale said. “Despite being at the mature stage of this cycle we still face a situation where key leading indicators such as HIA New Home Sales point to healthy levels of construction ahead, even if volumes will be down on the 2015/16 record high.”

“Total new home sales expanded by 1.5 per cent over the three months to July this year. That is a great result when the level of national new home building has already grown over four consecutive years,” concluded Harley Dale.

In the month of August 2016 detached house sales increased in four out of five mainland states, after falling everywhere in July and rising everywhere in June. In August 2016 sales increased by: 12.1 per cent in South Australia; 8.7 per cent in New South Wales; 7.8 per cent in Western Australia; and by 4.2 per cent in Queensland. Detached house sales fell by 5.0 per cent in Victoria during the month.