New homes sales rose again last month as relatively stable data for the past three months points to the market being at its lowest point.
“Sales of new homes across Australia rose by 6.8 per cent in April 2023 compared to the previous month,” HIA chief economist Tim Reardon said.
The data is contained in the HIA New Home Sales report—a monthly survey of the largest volume home builders in the five largest states.
“With sales relatively stable, albeit at extraordinarily low levels, for six months, it does appear that the market has reached rock bottom,” Reardon said.
“This puts sales for the three months to April stable compared to the previous three months.
“This suggests that sales may have levelled out and reached a floor, barely more than half their levels from a year earlier.”
The cancelation rate remains elevated with more than one new home project cancelled for each four new homes sold per month.
“This is its highest level since the start of the pandemic and is resulting in an accelerated decline in the pool of work sold, but not commenced,” Reardon said.
“The RBA’s rate increases last year and this year will continue to hold down new home sales and cause further cancellations as finance becomes unobtainable for an increasing number of buyers.
“Sales of new homes fell in all states in the three months to April except for Western Australia.
“Sales in Western Australia were higher in the three months to April (+37.1 per cent) than in the previous three months and year (+9.8 per cent).”
During the past year, NSW has experienced the largest declines, with sales in the April quarter down by 70.5 per cent on the same quarter in the previous year.
This was followed by Queensland (-51.7 per cent), Victoria (-46.3 per cent) and South Australia (-13.7 per cent).
Western Australia had the only increase over this period—9.8 per cent.
