house interior building
Home buyers rushed in late December to finalise contacts prior to the HomeBuilder 1.0 grants ending. Image: Rene Asmussen, Pexels
  • New home sales in January a third of December’s volume
  • 31 December 2020 was the deadline for $25,000 grant
  • HomeBuilder 2.0 - $15 000 – end in March

In its monthly update of sales of new homes sales data, the Housing Industry Association (HIA) has revealed that new home sales in January were just a third of the sales seen in December.

National sales in January 2021 were 12.1 per cent lower compared to the same time last year.

New South Wales and South Australia both saw rises; 3.3 per cent for NSW but rather significantly was South Australia which recorded a 34.1 per cent rise.

Victoria recorded the greatest fall of any of the other states at negative 27.5 per cent followed by Western Australia recording a drop of 15.5 per cent and Queensland down by 9.5 per cent.

The ending of the first form of Homebuilder required contracts to be finalised by the 31 December 2020, meaning many rushed applications at the end of last year.

From the 1st of January, Homebuilder 2.0 is a smaller grant of $15,000 that buyers can be eligible for providing contracts are finalised by the end of March 2021 and construction begins within six months of signing.

As a result of this, many sales have been pushed back to March to enable more flexibility with projects. This likely occurred in December, explaining why the volume of services was remarkably high for that month.

HIA believes due to this sales will remain flat in February before a surge in March, although the volume is unlikely to be as high as December due to a lower grant offering.

Many economists are eager to review March 2021 data as it will indicate just how much of an impact both versions of HomeBuilder have had over the past year.

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