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By Dianah Lewis Boucher via The Urban Developer
New home sales recorded a spike in four major states, New South Wales, Queensland, Western Australia and Victoria for the month of May, marking their highest monthly level in more than a year.
New South Wales recorded an uplift of 54.2 per cent, Western Australia 34 per cent, Queensland 26 per cent and Victoria 25.3 per cent, reveals the Housing Industry Australia’s Home Sales report.
South Australia saw a modest lift of 0.9 per cent.
The “bounce” follows a year of decline in new home sales, and poor results in the first four months of 2019.
HIA’s chief economist Tim Reardon said May’s pickup in sales follows “lacklustre results” experienced this year, some of the lowest monthly results on record.
“This month’s result confirms our expectation that the decline in building activity will start to level off in the second half of 2019 and stabilise at a level below the highs achieved back in 2017,” he said.
“The resurgence in home sales was evident across all five states covered by the New Home Sales Survey,” Reardon said.
“Suggesting a broad based improvement in housing market sentiment around the country.”
Related: Moody’s Forecasts House Price Bottom
So far 2019 has seen the Reserve Bank cut rates to a record low, APRA implement reforms to mortgage lending guidelines and the federal election take place. Events hailed by many industry professionals as boosting sentiment in the property sector.
Corelogic data released this week shows Sydney and Melbourne dwelling values recorded a lift for the month of June, and while modest, it was the first upward monthly movement since 2017 .
“Overall, it looks like the tide may have turned for the housing market; however we aren’t expecting a rapid recovery phase,” Corelogic head of research Tim Lawless said.
Reardon said the slow start to 2019 had seen “intense competition” among home builders in the residential sector.
HIA’s report, which offers an indication of trends in the residential building industry, covers the largest volume home builders in Australia’s five largest states.