Homeowners can be confident in their investment as we finish 2021, with the property market continuing an upward trend and the value of homes remaining strong across Australia. The HIA New Home Sales report for November recorded continued growth, leading property experts to predict a positive start to the new year.
Four Months of Sales Increases
The HIA New Homes Sales report has been showing growth in the market for most of the second half of the year, leading to a strong finish for 2021.
“This is the fourth consecutive monthly increase and leaves sales in the three months to November 8.0 per cent higher than the previous three months,” said HIA Economist Angela Lillicrap.
“Sales in the three months to November 2021 were significantly higher than pre-COVID levels. This is a strong level of home building and suggests that the current boom will continue throughout 2022 and into 2023.”
Positive Signs for Future Building Projects
The Report is viewed as a leading indicator of future detached home construction. It is expected that demand for new home construction will continue to grow next year, as more people decide to build their dream home in their ideal location.
“Demand for new detached and multi-unit construction has remained strong even with lockdowns. It appears that the more time people spend in lockdown, the higher demand is for detached housing,” said Ms Lillicrap. “The constraint on home building is not demand but the availability of land, labour and materials.”
“The shortage of labour and materials has led to construction timeframes increasing significantly. Under normal circumstances, the surge of HomeBuilder projects would have translated into an increase in completions from the June 2021 quarter. However, completions have not yet begun to respond.”
“This has resulted in the volume of work approved but not yet commenced at its highest level in over a decade,” Ms Lillicrap concluded.
The building industry can expect a steady stream of work to continue for many months, as people wait for labour and materials shortages to decline so that they can begin or continue their building projects.
Homes Sales State by State
Although the average across the country showed an increase in new home sales, the results were more positive in some states than others.
New South Wales experienced incredible growth in the past twelve months, with November 2021 numbers 27.8 per cent higher than the same time last year. NSW new home sales have increased consistently in the last three months.
However, Victoria and Queensland have had smaller number of new home sales in 2021 compared with the previous year. From November 2020 to November 2021, sales in Queensland declined by 8.6 per cent. In Victoria, it was a decline of 15.2 per cent over the same period.
Western Australia and South Australia have seen significant decreases in their new home sales across a twelve-month period. Western Australia and South Australia were 34.7 per cent and 36.9 per cent respectively lower in the three months to November 2021 compared to the same period in 2020.