Modest rise in new home sales
After two months of hefty falls, new home sales have steadied with a 1.1 per cent rise recorded in the month of August, new data has revealed.
According to the Housing Industry Association’s JELD-WEN New Home Sales Report, the number of new homes sold in August 2011 improved slightly following declines of eight per cent in July and 8.7 per cent in June.
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“New housing conditions are very soft at present,” HIA chief economist Dr Harley Dale said.
“For those who are in a financially capable situation to build a home, now is a very good time to contemplate doing so.
“There is unwillingness on the part of households to commit given the uncertain domestic and global economic conditions which currently prevail, and that is understandable. That’s where interest rate cuts and fiscal stimulus can play an important role in boosting new housing supply in a very competitive market, which in turn would have a positive multiplier effect in bolstering the wider domestic economy.”
Detached house sales increased by 1.5 per cent in the month of August 2011, but were down by 15 per cent over the August quarter. Sales of multi-units fell by 2.2 per cent in August.
“The improvement in the volume of detached house sales in August reflected a bounce of 9.8 per cent in Queensland and a rise of 3 per cent in Victoria,” Dr Dale said.
“August marked the first month of the Queensland government’s Building Boost Grant, and this has clearly had a positive, if modest impact on sales.”