Latest NewsNEW HOME SALES RISE FOR 3rd MONTHSunday, 21 May 2017

The number of new homes sold across Australia has increased for the third consecutive month, pushed up by solid gains in detached house sales in March.

The latest Housing Industry Association (HIA) New Home Sales Report shows the number of new homes sold increased by a seasonally adjusted 4.3 per cent in March, following a 0.6 per cent rise in February.

Detached house sales drove the positive results, rising by 5.8 per cent in the month, while multi-unit sales dropped by a "concerning" 10 per cent, HIA said.

HIA chief economist Harley Dale welcomed the results, but said there was still a long way to go for new home sales to reach healthy levels.

"The March result for new home sales reflects an ongoing pause in the interest rate hiking cycle and some abatement of the severe weather conditions witnessed in early 2011," Dr Dale said.

"A sustained period of improvement is required for new home sales and a raft of other leading indicators, before we can look ahead to healthy levels of residential building activity."

HIA said the three-month profile for detached house sales was encouraging, with sales volumes up by five per cent for the March quarter.

"However, the increase is exaggerated by a weak starting point in the final quarter of 2010 and volumes remain below the long-term average," HIA said in the report.

Sales volumes for multi-units for the three months to March were down by 5.9 per cent.

Total new home sales were down by nine per cent in the March quarter, compared with the same period a year ago.

HIA also found that NSW new home sales were up by a "very encouraging" 13.5 per cent in the month, for a 20.7 per cent rise in the first quarter of the year.

"Sales are on somewhat of a barnstorming run in NSW, from an awfully low base," the report said.

"The real feather in the cap of the state's new home building industry is the strength of the labour market."

Queensland's new home sales recovered from a lull in February, to be up by 11.1 per cent for the month of March, however sales were still down by 8.1 per cent in the March quarter.

Queensland's housing market remained in a position of serious weakness and government plans for a revival appear inadequate, according to the HIA.

House sales were subdued over the second half of 2010 in part because the Reserve Bank of Australia (RBA) lifted interest rates four times.

The central bank has since signalled that policy is on hold for now, though analysts suspect a further hike could come in the next few months.

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