New home sales recorded a slight uptick in the June quarter in a move marking the first lift since 2017, reveals the Housing Industry Association.
New home sales were up by 0.8 per cent on the previous quarter, with the slight improvement suggesting that declines seen in new home sales over the past year has started to ease.
Victoria recorded an increase of 5.1 per cent for the June quarter, the state's second quarterly rise since late 2017.
While Western Australia recorded an uptick of 2.9 per cent, and South Australia 2.6 per cent.
New South Wales recorded a 1.7 per cent decline in new home sales for the June quarter, and Queensland recorded the largest fall of 8.9 per cent for the period, which the HIA described as a “moderation of earlier declines”.
Over the 12 months to June HIA says new home sales have recorded a 12.4 per cent decline.
Home prices and building approvals cooled across Australia from early 2018, largely due to increasingly tight credit and APRA’s regulatory measures.
HIA chief economist Tim Reardon said the RBA’s two interest rate cuts, easing of APRA’s regulatory restrictions would increase activity in the home building market.
“These measures, combined with ongoing stable population and employment growth should see new home sales improve toward the end of the year,” he said.
“The upside of the current building industry downturn is that activity levels have synchronised across the east and west coasts – and within each state – making it easier for policy makers to coordinate policy settings.”
The home sales report, which takes in the largest volume builders across five states, shows New South Wales approvals ticked up by 1.6 per cent in the month of May, leaving the state down by 20.8 per cent for the quarter in comparison to the same quarter last year.
While approvals in Victoria were up by 2.8 per cent for the month of May, HIA says this leaves them down by 18.8 per cent for the quarter compared to the same quarter last year.
Queensland approvals are also down by 2.1 per cent for the month of May, which leaves the three months to May down by 23.9 per cent compared to the same quarter last year.
HIA expects Queensland’s market to be supported in the second half of 2019 by cuts in interest rates and income tax, loosening of lending restrictions and strong interstate migration numbers.