Sales of new homes in australia stumble

Sales of new homes in Australia stumbled in February, according to the Housing Industry Association.

New home transactions increased for four months in a row, but fell back by 5.3 per cent last month, the HIA announced, reflecting a 4.0 per cent reduction in detached house sales and an 11.0 per cent drop in multi-unit sales.

“These data are disappointing in the context of the growth in sales over previous months,” said HIA Senior Economist, Shane Garrett. “The broadly based decline in activity during February is a reminder of how delicate the nascent recovery in the housing industry really is,” added Shane Garrett.

In the month of February 2013 detached house sales fell by 13.7 per cent in Victoria, 2.8 per cent in New South Sales and 6.7 per cent in South Australia. Increases in detached house sales occurred in both Western Australia (+1.9 per cent) and Queensland (+0.8 per cent) during February.

“If we take a broader view of the situation, the overall direction of activity is still quite encouraging,” commented Shane Garrett. “New home sales are up strongly over the last three months in almost all states, in terms of both houses and multi-units,” added Garrett.

“Nonetheless, February’s data emphasise how far housing market activity has fallen from the levels of just three years ago. The industry is struggling in the current economic environment and strong policy measures will be required to bring market activity back up to levels consistent with Australia’s long term requirements.”