New home sales fall in four key Australian states
Article by Mozo
New home sales fell by 4.7 percent in July, the first time in five months that sales have fallen, reports the Housing Industry Association.
The New Home Sales report, released today, which surveys Australia's largest volume builders reported that that detached house sales fell 6.4% in July, which was also the first decline since February, while sales of multi-units rose 7.2 percent.
Dr Harley Dale, HIA Chief Economist said that while disappointing, a one month fall does not really change the story of an upward momentum to new home sales but he warned that further decline would be an issue.
"The re-emergence of a sustained decline for new home sales over the second half of the year would obviously be a negative signal for residential construction and the wider economy," he said.
Dr Dale also noted that new home sales volumes are well short of healthy. "It remains the case that detached housing sales are running well below long term average levels in four out of five mainland states."
States which have seen a decline include New South Wales (down 4.25%), Victoria (down 10.5%), South Australia (down 9.6%) and Western Australia (down 10.8%).
While new home sales fell, sales of existing homes have increased in recent months as investors flocked to the market spurred on by record low interest rates. Investor lending was up 35% in the last quarter making it the fastest growing category of home loan lending.
Home buyers are encouraged to not only shop around for the best property, but also the best home loan. Interest rates at record lows and a 1 percent difference in interest rate on a $400,000 home loan could lead to savings of $239 a month (comparing a 25 year loan at an interest rate of 5% compared with 6%). To compare home loans from Australia's banks and lenders go to comparison sites like mozo.