New Home Sales Strong Despite Interest Rate Rise
In a complete contradiction of expectations, new home sales increased nationally by 1.9% in June over May – 11.1% higher than the same quarter in 2021.
Growth in Victoria and Queensland
Victoria and Queensland are solely responsible for this growth, with home sale increases of 4.2% and 6.7% respectively. New South Wales saw no growth, while Western Australia and South Australia saw declines.
So does this mean that home sales will continue to defy interest rate rises?
HIA Economist Thomas Devitt states that “Those households purchasing a home in June likely began that process before the first cash rate increase in May.”
Devitt also notes that “The industry is noticing a slowing in the number of groups visiting display sites in recent weeks which could result in fewer new home sales in the second half of 2022.
Source: HIA "New home buyers defy rate rises." July 25, 2022.