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Construction of new homes will be strong well into next year as new home sales increased 5.8 per cent in August.
However, meeting this demand will continue to challenge the construction sector as it deals with lengthy material delays and cost hikes. This was likely to extend until 2022 as developers rush to meet demand for new homes.
For August, sales in Queensland increased 44.3 per cent, NSW 17.9 per cent and South Australia was up 64.3 per cent, according to HIA new home sales data. The results were worse for Victoria, down 10.8 per cent, and in Western Australian where activity also dropped, by 11.8 per cent. The report showed that while buyer activity was rising, it was 15.5 per cent lower than in the three months to August last year during HomeBuilder, but well above 2019 levels.
HIA economist Tom Devitt said new home sales remained strong in August, albeit not at the record levels prior to the end of HomeBuilder in March 2021.
“The strength in new home sales in recent months indicates that the boom in detached home building will continue to create strong employment opportunities into the second half of 2022,” Devitt said.
“A more reasonable timeframe for comparison is the same period in 2018 and 2019, before the adverse impact of Covid-19 and the stimulus from HomeBuilder.
“In the past three months sales were 15.4 per cent higher than at the same time in 2019 and 4.5 per cent higher than the same time in 2018.”
Comparing the results to before the pandemic, in the three months to August, Western Australia was up 60.0 per cent, followed by NSW up 28.1 per cent and Victoria 6.7 per cent compared to 2019.
Queensland was down 1.5 per cent for the same period and South Australia was 15.2 per cent down.