There has been evidence that the demand for brand new homes for sale has risen, as data from the Australian Bureau of Statistics (ABS) showed an increase in housing finance for new real estate in Australia.
The data revealed a third consecutive rise in new home lending in July, with owner occupier finance figures rising by 0.7 per cent for the month.
A 0.7 per cent increase has now brought the level of construction and purchases of new homes to be 15.5 per cent higher than it was in July 2012.
“There were 8,396 loans to owner occupiers for the purchase and construction of new [homes] during the month of July 2013 – the strongest monthly result since early 2010,” said Housing Industry Association (HIA) Economist Geordan Murray.
“This was the third consecutive month that the lending for new homes has increased which continued the steady upward trend that has been evident since the market reached a cyclical low in early 2011.”
At the same time, the value of new dwellings being constructed and purchased by Australians rose over July.
“The value of lending to owner occupiers for construction and the purchase of new homes increased by 2.5 per cent, while lending to investors purchasing new homes increased by 3.3 per cent in the July quarter of 2013,” said Mr Murray.
These increases in new home lending have led to some states heading into a recovery – such as Victoria.
Lending for new real estate in Melbourne and the surrounding areas of the state rose by 7.6 per cent for the month, seasonally adjusted.
Although this figure is still 12.3 per cent higher than it was in July 2012, the increase shows that the market is headed into a gradual recovery.
“It is important we see evidence emerge over the remainder of 2013 that new home lending is recovering in a sustainable manner,” said HIA Executive Director for Victoria Gil King.
South Australia saw a substantial rise in new home lending from owner occupiers for July this year, after reporting a year-on-year increase of 36.1 per cent.
This growth has been attributed to the new residential construction grant of $8,500 that was put in place by the South Australian government.
“The figures which have been released this day indicate that it would certainly be a good policy decision to extend that grant beyond the December cut-off which is currently in place,” said HIA South Australia Regional Executive Director Robert Harding.