Housing Industry Association's Chief Economist Tim Reardon has advised that new home sales have risen by 77.6 per cent in June, from a record low result in May.

"(This is) off the back of the Government’s HomeBuilder program announced at the beginning of the month,” said Mr Reardon.

“The rebound in new home sales in June does not fully offset the dismal results of the preceding three months and we are cautious of over interpreting data from a single month.

At a Glance:

• New home sales have risen by 77.6 per cent in June, from a record low result in May.
• Up to half a million jobs were at risk without government intervention.
• Western Australia experienced the largest improvement with sales more than doubling during the month of June.

"It is a clear indication that HomeBuilder will help protect jobs in the sector in the second half of 2020 and into 2021.

“Additional sales data from July and August will be necessary before drawing accurate estimates on the impact of HomeBuilder on employment in the sector.

Mr Reardon said new home sales data is highly responsive to changes in consumer confidence.

“New home sales fell to their lowest level on record in March and continued to fall in April and May," said Mr Reardon.

"Without intervention, a significant contraction in the volume of work on the ground would have occurred in second half of 2020 leading to a contraction across the wider economy.

"Up to half a million jobs were at risk without government intervention."

Mr Reardon said the improvement in June can be seen across all the states which he added is a good indication that the HomeBuilder program is working, to varying degrees in each jurisdiction.

“The Government’s announcement of the HomeBuilder program has seen confidence in the market improve," said Mr Reardon.

“Western Australia experienced the largest improvement with sales more than doubling during the month of June, albeit from an exceptionally low base.

"This is not surprising given the State Government’s ‘Building Bonus’ program, which if combined with the first home buyer scheme can provide support exceeding $50,000.

“This will create significant employment opportunities and not just in the home building sector."

Mr Reardon said the cancellation rate (percentage of sales cancelled during the month) remains elevated at 23 per cent, down from a peak of 30 per cent in April, suggesting there are still many households that have made the decision not to proceed with a previous new home purchase in light of the changed economic conditions.

“If the momentum from HomeBuilder continues, we will see more slabs poured before the end of the year, protecting jobs across the economy in manufacturing, retail and professional services,” said Mr Reardon.

By state

• Western Australia rose by 211.2 per cent. 
• South Australia rose by 157.1 per cent.
• Victoria up by 47.8 per cent.
• Queensland up by 43.3 per cent.
• New South Wales up by 12.6 per cent.

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