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Wed, Nov 1, '17 by Real Estate Investar
New home sales continue to slump but have yet to reach their low point.
The drop in new home sales began in 2015 and continued in September with with a 6.1 per cent reduction, according to the latest Housing Industry Association report.
New detached house sales fell by 4.5 per cent, and the slowdown was far worse for sales of new units, which slumped 16.7 per cent.
HIA senior economist Shane Garrett said residential building activity peaked in March 2016 following the longest ever upturn in new home building.
"We expect that activity will bottom out sometime in 2019 with a recovery then setting in - assuming the economy reverts to its long-term average growth rate of around three per cent," he said.
Mr Garrett said Australia needed an average of around 180,000 new homes built annually in the long-term to keep pace with a growing population.
He expects the number of homes being built to dip below that benchmark in 2019, which will then trigger a housing shortage and a subsequent recovery in new home starts and sales.
Meanwhile, a record number of Melbourne auctions last week made it the Australian property market's busiest of the year.
Melbourne's 1,983 auctions in the seven days to October 29 lifted the total across the combined capital cities to 3,690, beating this year's previous high of 3,517 in the week before Easter.
The national preliminary auction clearance rate rose from last week's revised 64.7 per cent to 67.8 per cent, according to CoreLogic.
And the property data group said more records could fall before the year's end.
"Historically auction volumes have peaked around late November/early December," CoreLogic said.
"If this trend holds true this year, we could see new records being set for auction volumes as the Spring season concludes."
Melbourne had a preliminary clearance rate of 71.7 per cent, while Sydney's clearance rate fell to 64.1 per cent, compared with 80.5 per cent a year ago.
Combined capital city prices remained relatively steady overall, dropping 0.1 per cent in Sydney and improving 0.2 per cent in Melbourne.
Prices in Brisbane, Perth and Adelaide were unchanged.
The median price across all capital cities was $690,687 for a house, and $571,166 for a unit.
CAPITAL CITY PRIVATE TREATY MEDIAN PRICES
Sydney - $945,000
Melbourne - $728,000
Canberra - $600,000
Darwin - $575,000
Brisbane - $520,000
Perth - $499,000
Adelaide - $440,000
Hobart - $400,000
Combined capitals - $690,687
Sydney - $720,000
Melbourne - $522,000
Canberra - $430,000
Brisbane - $400,000
Darwin - $395,000
Perth - $380,500
Adelaide - $332,500
Hobart - $300,000
Combined capitals - $571,166
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