New home sales has peaked, but the housing market still remains in strong shape for the year ahead, a leading housing association has claimed.
Total seasonally adjusted new home sales eased by 0.4% in July, according to the Housing Industry Association’s (HIA) New Home Sales report. However, HIA chief economist, Dr Harley Dale says this isn’t cause for concern.
“New home sales are drifting along at a historically high level. It appears that the cyclical peak for total new home sales occurred in April, but the subsequent downward trend is very mild,” he said.
“Key leading indicators of home building… suggest little prospect for further growth in new home construction in 2015/16. However, following three consecutive years of strong growth which has propped up the domestic economy considerably, both HIA New Home Sales and ABS Building Approvals signal another healthy year for new home construction in 2015/16.”
According to HIA’s report, house sales increased by 0.7% in July. However, over the three months to July, house sales fell by 2.8% to be 3.4% lower when compared to the three months to July 2014, indicating that the annual peak has already passed.
Multi-unit sales peaked in May this year and fell by 4.2% in July following a decline of 2.9% in June. Over the three months to July, multi-unit sales increased by 8.3%, but it was the strength of the May result that drove the quarterly outcome.