Victoria the Exception as National Dwelling Sales Decline

Victoria was the only state to buck the trend in a downward market for house sales activity according to new private dwelling sales data from the Housing Industry Association.

“A drop in new apartment sales have contributed to the continuing decline in new home sales nationally since they peaked in mid 2015,” HIA’s Principal Economist, Tim Reardon said.

“July’s result was driven by a 15.7 per cent decline in multi-unit sales and a more measured reduction in detached house sales. The large drop in multi-unit sales this month is in contrast to strong sales volumes late in 2016 and early 2017."The HIA New Home Sales report – a monthly survey of the largest volume home builders in the five largest states – shows that sales volumes declined by 3.7 per cent during July 2017 compared with June 2017. Sales for the first seven months of this year are 4.6 per cent lower than in the same period of 2016.

“This trend is consistent with HIA’s expectation that activity will decline modestly from these record high levels over a number of years,” Reardon said.

“Victoria was the notable exception – as the only state to grow sales during July 2017. Sales were up by 9.8 per cent on what is already a very high level of activity.

“On the other hand, the Western Australian Government’s First Home Buyers grant ended on 30 June 2017 and as a consequence sales in July fell sharply from what was already a very low base."Sales of new detached houses during July 2017 fell by 0.4 per cent nationally to their lowest level since October 2014.

Victoria was the only state to experience growth (+9.8 per cent). Detached house sales fell in South Australia (-16.2 per cent), Queensland (-16.1 per cent), Western Australia (-9.1 per cent) and New South Wales (-5.2 per cent) during the month.

"Victoria remains the jewel in the crown of Australian home building activity at the moment and with a further 9.8 per cent growth on what is already a very high base it has extended its lead as the most active detached home building state," the report said.

"For the year to date Victorian detached home building activity has been consistently strong with sales this year just 0.4 per cent lower than in the year to July 2016. House approvals also rose marginally for the month to show consistently strong results for almost two years. This suggests that Victoria will continue to pull the national results forward for some-time to come.

"Strong population and employment growth in Victoria are at the core of these strong results."