CORONAVIRUS COVID-19 PANDEMICRESIDENTIAL PROPERTY

Buoyant conditions remain for large home builders

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SALES of new detached houses increased by 2.3% over the month in September, as forward indicators remained positive for housing construction despite the federal government’s HomeBuilder package having wound up back in March.

The latest HIA New Home Sales report – a monthly survey of the largest volume home builders in the five largest states – also showed in the six months from April to September, new home sales were 9.3% above the same period in 2019 and 0.8$ above the same period in 2018.

On a quarterly basis, the last three months were up by 7.4% and 0.6% on the same quarters in 2019 and 2018, respectively.

“These are the best years for comparison, rather than 2020, as they pre-date both the pandemic and the HomeBuilder stimulus,” HIA economist Tom Devitt said.

“It has been over six months since the end of HomeBuilder in March 2021 and sales have remained resilient.

“These relatively strong sales will ensure that the boost in home building flows through to the second half of 2022. When combined with the ongoing strength in renovation activity the home building sector will continue to pull the economy forward for at least the next year.

“This will continue to see high demand for skilled trades and ongoing employment opportunities in the sector into the second half of 2022.”

Western Australia led the pack in the six months to September, up by 46.3% compared to the same period in 2019, followed by New South Wales (up 34.6%), while Queensland, Victoria and South Australia saw slight to modest falls.

Construction activity partially recovered in September, driven by engineering activity, according to the Australian Industry Group/Housing Industry Association Australian Performance of Construction Index, while lockdowns in Sydney and Melbourne continued to drag on house building.

Improvement is expected as the major cities reopen.

Activity in apartments and housing construction improved, but remained in contraction during September.

The latest Australian Bureau of Statistics data shows home approval numbers lifted in August due to record-low interest rates, increased household savings, and confidence in the housing market.

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