The HIA has claimed a bounce in new home sales is not enough to stave off a recession in housing construction.
The HIA - JELD-WEN New Home Sales report has indicated a rise in sales both for detached housing and multi-units. Housing sales overall increased by 6.9% in April, with detached housing sales rising 6.4% and multi-unit sales jumping 10.3%.
But HIA chief economist Harley Dale has argued that the result will not keep the home building sector from heading into recessionary levels.
"Even with this latest improvement, the aggregate volume of both new home sales and local government building approvals imply that in the absence of a rapid and sustained recovery, national new home building is heading to a recessionary level in 2012," Dale said.
Dale claimed a lack of consumer confidence continued to dog Australian home sales.
"We keep hearing that Australia is one of the world's strongest economies in aggregate. That's a redundant concept if people on the ground aren't feeling and experiencing that, and they haven't been for quite some time," he said.
While Dale said further RBA cuts would be needed to boost the sector, he called on further action from the government.
"Further interest rate cuts are required, and the Reserve Bank should just get on with the job on June 5; However, rate cuts are not a panacea, and the key to a housing recovery lies with government at all levels," he said.
Barring government intervention, Dale claimed the sector could see further job cuts.
"Job losses are mounting, and governments need to collectively act to revitalise new home building through reducing the sector's excessive tax burden and through an immediate injection of investment and funding," he said.