New home builds’ cost will continue to surge until 2022

With new home sales increased by 5.8% in August, it is anticipated that the home building industry will be strong next year. Lengthy material delays and cost hikes still continue to challenge the construction sector amid pandemic. HIA August home sales data shows Queensland sales have increased to 44.3%, New South Wales gone to 17.9% and South Australia hits 64.3%.

Victoria experienced the worst sales result, down by 10.8% and Western Australia also dropped by 11.8%. The report showed that while buyer activity was rising, it was 15.5% lower than in the three months to August last year during HomeBuilder, but well above 2019 levels.

“New homes sales remained strong in August, although not at the record prior to the end of HomeBuilder in March 2021. The strength in new home sales in recent months indicates that the boom in detached home building will continue to create strong employment opportunities into the second half of 2022,” HIA economist Tom Devitt said.

Comparing the current sales figure before the adverse impact of Covid-19 in 2018, 2019 and before the HomeBuilder stimulus was rolled out, there is a significant difference. In the last 3 months, sales were 15.4 per cent higher than at the same time in 2019 and 4.5 per cent higher than the same time in 2018.