3 states where there are more new homes to buy
The number of new homes to be built in Australia rose in May, though approvals were mostly for units, based on the latest data from the Australian Bureau of Statistics (ABS).
The total number of new units to get the go-ahead across the country hit 14,175 in May, while new house approvals hit 9,163. Together this represented a 5.5% increase for all approvals on April.
The key question then is, where can a would-be buyer look if they’re keen on a new home specifically?
There are three states worth checking out ahead of others, based on the latest new home approvals: Western Australia (up 8%), New South Wales (up 6%) and Queensland (up 4%).
WA, NSW and QLD up close
WA is an interesting case study because it already has a limited supply amid a growing population. There aren’t many homes for sale at present, with about 2,000 houses and just under 1,000 units, as per figures from the Real Estate Institute of WA. So new home builds are much needed.
Similarly, Queensland has seen good population growth and has benefited from Brisbane’s rising economy, which has meant property prices have gone up, generally. There's clearly a need for new homes to be built.
More new homes in NSW are also welcome news for a lot of prospective buyers, given it’s typically the nation’s most competitive market. It’s also the city where a median house price of $1.6m (Domain) requires a $1.3m dollar home loan based on a $300,000 deposit (20%).
While Sydney's median price is still very high, recent months have shown a steadying of the sharp price gains of the past few years. In fact, in the year to July Sydney home prices are only up 6%, a much softer rise than in other capitals such as Perth or Adelaide, based on Corelogic’s figures.
How do you pinpoint an area to buy a home in Sydney?
Still, even with winter’s chill, auctions have been pretty steady in Sydney over the past few months. In its most recent auction preview, Corelogic reported a higher number of auctions in the inner south west, North Sydney and Hornsby and the inner west, so those could be currently less competitive areas to explore.
No, they won’t all be new builds but it should be noted that the NSW government recently targeted inner west suburbs such as Dulwich Hill, Ashfield, and Croydon, as well as northern suburbs such as Roseville, Lindfield, Killara and Gordon for higher density building, as per a report by the ABC.
Further still, new home builds can be less expensive than existing properties if there’s a good supply of them and they aren’t pitched at luxury buyers. New home buyers can also benefit from a range of home buyer grants to help bring the total cost down. Good examples of these are the First Home Buyers Assistance Scheme or First Home Owners Grant in NSW.
Houses versus units to buy
Finally, there are far more houses for sale nationally than units, so depending on your state, the ratio of houses to units is worth checking. SQM Research reports around 231,000 properties for sale in June, with only 59,000 of those units (approx).
This might be the case right now, but most new residential builds will likely be units and townhouses because governments are focused on increasing urban density in Australia, especially where space is limited.
If you’re ready to buy and need a home loan, be sure to compare some of the leading home loans in the Mozo database below.