Home sales down in May

The number of new home sales completed in May slumped 5.7 per cent compared to the previous month, the Housing Industry Association (HIA) has revealed.

Announcing the new figures, the group warned that the market cannot depend on first-timers with new low-interest home loans and first-home buyers grants to prop up the industry.

The HIA’s senior economist Ben Phillips clarified: "As that segment inevitably slows over the remainder of 2009 it’s vitally important that the much larger trade-up and investor segments return to health."

Further figures from the organisation revealed that while home sales were down, there was a marginal increase in the number of apartments sold.

However, the group explained that the sector was still recovering from a very weak start to the year.

Last month, the HIA predicted that the Australian market will enjoy "moderate recovery" over the next year and a half, supported by low-interest home loans and new home building.

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