HIA: Rate cut produced immediate results for property sector
The decision by the Reserve Bank of Australia (RBA) to reduce the interest rate by 25 basis points has had a pronounced and measurable impact on the residential property market, according to a new report.
The Housing Industry Association (HIA) has released the results of a joint survey that details the volumes of new homes sold over November 2011.
The HIA - JELD-WEN New Home Sales report shows that - from the 100 building firms covered by the research - a seasonally-adjusted growth rate of 6.8 per cent was achieved by the market.
This was on the back of a previous drop in sales of 2.8 per cent in October, when many in the industry were wondering if the sector was going to be able to recover from slumped consumer confidence.
Driving the positive result was the 9.8 per cent growth marked by sales of detached houses - in stark contrast with units and apartments which saw a drop of 17 per cent over October's figures.
Chief economist for HIA Dr Dale Harvey described the result as healthy but "not unexpected - pointing out that the industry had reached a record low only two months prior.
Dale asserted: "From this parlous starting position and with speculation regarding a rate cut mounting and then delivered upon, anything other than some recovery in sales volumes would have been surprising, not to mention highly disturbing."