New home sales fall as HomeBuilder end date approaches

With the government’s HomeBuilder scheme due to expire on 31 March, the Housing Industry Association finds that new building sales in January fell to just 30 per cent of December’s sales totals.

HIA’s New Home Sales report attributes the difference in volume to the HomeBuilder scheme drawing forward sales in December.

HIA chief economist Tim Reardon said the January result was encouraging given the usual slowdown in activity that occurs at the beginning of the year, and that more sales are expected off the back of the housing grant.

“After drawing forward sales into December, HomeBuilder will also push sales back until the end of March when the reduced $15,000 grant ends,” he said.

“For this reason, sales are expected to remain flat in February before another surge in March. The March surge will not be of the same quantum as December due to the lower grant offering.”

The HomeBuilder grant was introduced in June last year to keep the pipeline of work in the construction sector from drying up, with high uptake prompting the government to extend the program in November.

Under the modified version, owner-occupiers can receive $15,000 when purchasing new builds valued at under $950,000 in New South Wales, $850,000 in Victoria, and $750,000 in all other States and Territories.

RELATED: February property bounce: Listings and auction sales increase


The impact of the scheme can be detected in the ABS approvals data, which saw building approvals for private houses jump up 15.8 per cent in December, marking the sixth straight month of growth.

“New Home Sales reached remarkable heights in the December 2020 quarter, almost 100 per cent higher than at the same time the previous year,” said Reardon.

“The impact of HomeBuilder is already being observed in record high housing finance results and approvals data and this will lead to strong jobs growth in the industry in 2021.”

“Low interest rates, rising house prices and a demographic shift in demand towards detached housing and regional areas should ensure ongoing demand for new homes albeit at a level significantly below that observed in the last quarter of 2020.”

For information about mortgage and lending trends, visit our home loan statistics page. And for an idea of where interest rates currently sit, check out our home loan comparison page, or browse the selection below.

Home loan comparisons on Mozo - rates updated daily

Search promoted home loans below or do a full Mozo database search. Advertiser disclosure.
  • placeholder
    Mozo Experts Choice 2021
    Smart Booster Home Loan

    2 Year Discounted Variable Rate, Owner Occupier, Principal & Interest, <80% LVR

    interest rate
    comparison rate
    Initial monthly repayment
    1.85% p.a.variable for 24 months and then 2.25% p.a. variable
    2.21% p.a.
    Go to site
    Details
  • placeholder
    Mozo Experts Choice 2021
    UHomeLoan

    Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    Initial monthly repayment
    1.85% p.a.
    fixed 3 years
    2.24% p.a.
    Go to site
    Details
  • Hot DealFor a chance to win $100K towards your home loan, apply with Athena before Oct 31 & approved by Dec 15 (Please read the full T&C's)
    placeholder
    Mozo Experts Choice 2021
    Celebrate Variable Home Loan

    <60% LVR, Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    Initial monthly repayment
    1.99% p.a. variable
    1.99% p.a.
    Go to site
    Details
  • placeholder
    Variable Home Loan

    Owner Occupier, Principal & Interest

    interest rate
    comparison rate
    Initial monthly repayment
    1.99% p.a. variable
    1.99% p.a.
    Go to site
    Details
  • placeholder
    Basic Home Loan

    Fixed, Owner Occupier, Principal & Interest, LVR<70%

    interest rate
    comparison rate
    Initial monthly repayment
    2.09% p.a.
    fixed 3 years
    2.32% p.a.
    Go to site
    Details

* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate, loan amount and term entered. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

^See information about the Mozo Experts Choice Home Loan Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.