- New home sales fell by 54.4% in April
- Housing Industry Association Economist says the results are 'strong'
- New house sales are still high compared to pre-pandemic era
As HomeBuilder came to an end in March, the demand for new home sales has taken a significant autumnal dip falling by 54.4% in April, according to data released by the Housing Industry Association (HIA).
The HIA’s monthly survey of the largest home builders by volumes in the five largest states is commonly used as an indicator of the level of future detached homes construction.
Despite the headline fall in new home sales, HIA Economist Angela Lillicrap says the results are, actually, “an encouragingly strong result”.
“It suggests that there is a significant volume of new homes to be built for customers not eligible for HomeBuilder,” clarified Ms Lillicrap.
“Despite being well below recent peaks, sales in April 2021 are just 2.7 per cent lower than the average month prior to the COVID shock.
“There is an unprecedented volume of building starts set to occur in 2021. HomeBuilder and lower interest rates have facilitated in a surge in demand or detached homes that ensures a record number of new detached homes will be built this year and into 2022.”
Angela Lillicrap, HIA Economist
A cooling in new home sales was expected as the program officially ceased at the end of March.
The new figures come after both record highs and lows were recorded last year. The new level feels a lot more like normal in what also seems like a more ‘normal’ year.
In April, sales fell across all of the five largest states with South Australia – which recorded the highest number of HomeBuilder applications per capita – leading the decline by 71.7%. Western Australia had the smallest decline with new home builds falling only 15.2%.
Sales in April, however, remained higher compared to the monthly 2019 average, pre-pandemic. New South Wales builds are 30.3% higher, and Western Australia 27.5% higher, than that ‘more normal’ year.
“The demographic shift in population towards regional locations and low interest rates will continue to drive demand for new homes over the months to come, albeit at a level well below recent peaks,” concluded Ms Lillicrap.