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“Lending for new homes is down by 62.4 per cent since its peak in January 2021, to its lowest level since November 2012,” added Mr Reardon.
“Sales of new homes have stalled in recent months as market confidence declines.
“This poor data is as a consequence of the fastest increase in the cash rate in a generation. Despite this, the impact of last year’s rate increases won’t be fully apparent until late this year.
“The decision by the RBA to increase rates further in 2023, will further erode market confidence and accelerate the downturn that is already evident.
“There are significant lags between a change in the cash rate and its impact on the economy. In this cycle, it will take up to 18 months before the impact of the May 2022 rate increase fully flows through to employment in the sector.
“The supply chain disruptions of the pandemic are easing. Inflation in other economies is slowing and interest rates are not the only tool at governments’ disposal to address the inflationary problem,” concluded Mr Reardon.
HIA has released the latest version of its Housing Scorecard. Once again Victoria is underperforming and has now fallen below New South Wales. Only Tasmania, the Australian Capital Territory and the Northern Territory keep Victoria from claiming the wooden spoon.
Tasmania has ranked last in the national HIA Housing Scorecard released today, underscoring a persistent failure to deliver enough new homes to meet current and future housing demand.
“Western Australia retained its status as Australia’s strongest home building market, even extending its lead, atop HIA’s latest Housing Scorecard,” stated HIA Senior Economist Tom Devitt.
With NCC 2025 scheduled to commence in Tasmania from 1 May 2026, given the legislation has not passed the Tasmanian Parliament yet, CBOS is offering to HIA’s members a short webinar to explain what this means for your projects and business.