New home sales hit highest level in April

HIA economist, Maurice Tapang, said the increase was due to the February rate cut, when the Reserve Bank of Australia slashed mortgage rates by 0.25 per cent for the first time in four years.

Additionally, he said April saw a rebound in future detached home construction following March declines, which had been affected by Cyclone Alfred and other bad weather that slowed activity in some states.

“The other factors supporting new home buying activity include low levels of unemployment, recovering real wages and elevated housing demand from ongoing population growth,” Tapang said.

“New home sales data have signalled that home building may be past its trough, confirming our expectations of a pick-up in activity in 2025.”

Across the country, Tapang said the forecasted increase will most likely be inconsistent across the states, with Queensland and Western Australia leading the charge.

Data showed that new home sales in Western Australia increased by 23.7 per cent in the three months to April 2025 compared to the previous quarter, with Queensland recording the next highest growth at 8.2 per cent.

Tapang said that sales in NSW have, after two years of significantly low activity, improved at the beginning of the year, recording a 2.2 per cent increase in the three months to April.

On the other hand, Victoria experienced a weak start to 2025, with sales falling for several consecutive months by 1.2 per cent in the April quarter, 17.7 per cent lower than during the same period last year.

Similarly, South Australia saw a 13 per cent drop in sales over the same period.

“With another rate cut having been delivered in May and expectations of further cuts on the horizon, it would not be surprising to see increases in new home sales in the months ahead,” Tapang concluded.

This article was originally featured in Broker Daily sister brand Real Estate Business.