NSW New Sales Improve While Higher Rates Hurt Sales Nationally - HIA

New South Wales’ peak building industry body, HIA, said that despite the slight rise, the lack of momentum confirms recent statements from many medium and large volume builders across the state who said that the double whammy of the May rate increase and the relentless increase in petrol prices has had a measurable effect on enquiries and sales.

HIA’s Executive Director New South Wales, Mr Wayne Gersbach said that lags between rate rises and official statistics pose a significant risk for both the economy and housing sector.

“There has been a universal theme from recent discussions with NSW major builders and developers, most of whom are still yet to see a sustained improvement in sales and enquiry levels ,” Mr Gersbach said.

“One developer stated that the principal difference between the next potential tightening and the most recent rate move is that the Reserve Bank has already taken the heat out of the residential market. Any further rises will have a calamitous effect on sales and activity.”

“Another stated that while they typically exchange 60 to 65 contracts each month, this had barley reached 50 over the each of the 3 months to July. Sales teams are reporting a distinct lack of urgency among consumers, all at a time of an apparent rental crisis.”