New home sales crash begins
New home sales fell sharply for a fourth consecutive month, reported the Housing Industry Association today:
New home sales were down by a further -10 per cent in August, as the impacts of the Budget gradually begin to have an impact.
Source: HIA
There is still a decent supply of new housing in the pipeline, and the impacts won't really be felt until next year and beyond:
Source: HIA
Chief Economist Tim Reardon projects that the pipeline of work for new homes will largely be exhausted in Sydney and Melbourne by the end of the year unless sentiment improves.
As such the government's Housing Accord target pledge has evaporated into thin air.
Unfortunately this trend is set to worsen significantly as the RBA hikes rates in September, and quite likely October too.
It's set to be a tough 6 to 12 months for households as interest rates go up - and a challenging period for government polling as well.
A poll this week from Roy Morgan Research reported Primary support for the government at just 25 per cent, even ahead of the 'golfing scandal', which will be captured in the next round of polling.
Of course, we can always be prone to cherry-picking polls, but it's often hard to maintain popularity into a fourth and fifth year in office, and the recent downtrend in Primary support from 37 per cent to 27 per cent has been fairly clear.
Source: Mark the Graph, X, @MArk_Graph
One Nation has proposed swinging cuts to temporary visa numbers as it looks to establish itself as the party of opposition.
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The national residential vacancy rate held at 1.3 per cent in August 2026, according to SQM Research:
Source: SQM Research
The real test for the rental market will come once the current pipeline of new home construction dries up.
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