New home sales on the up

It has been a positive start to the new year with new home sales, recording a 0.5 percent increase in January according to the Housing Industry Association (HIA).

Both detached housing and multi-unit sales increased for the period. Detached housing rose by 0.3 percent, while multi-unit sales increased by 1.6 percent.

Shane Garrett, HIA Senior Economist stated that new home sales have been rising pretty steadily since the third quarter of 2012, encouraged by the falling interest rates and return of confidence to the housing market.

"The return of house price growth to most cities has done much to old the market and allow transactions to start occurring in greater numbers," he said.

The new home sales recovery however has not benefited all states equally according to the HIA. In January 2014, Private detached house sales increased 10.9 percent in Victoria and 0.4 percent in Queensland, while South Australia fell by 6.9 percent, by 6.4 percent in NSW and 1.9 percent in Western Australia.

"State governments will be framing their budgets in the coming months, and it is vital that their policies work to sustain the housing market recovery," said Mr Garrett.

While property prices around the country continue to rise, Australians looking to enter the housing market are spoilt for choice in the number of competitively priced home loans available. Competition in fixed rate home loans remains high, with all the major banks offering sharp 2 year fixed rates. And with predictions that the RBA is going to keep the cash rate steady for some time yet, lenders of variable rate home loans are offering incentives for new customers which range from cash back to frequent flyer rewards. 

For more details on current rates and incentives check out Mozo's expert's predictions for the autumn property market.