Housing shows signs of life as first buyers return

WESTERN Australia’s new housing sector is showing signs of a recovery, with building approvals, home sales and land sales all increasing over recent weeks.

Residential building approvals were up 5.7 per cent in WA in February, compared to the previous year, according to Australian Bureau of Statistics data.

Approvals for townhouses, units and attached cottages carried the total number of private dwellings up 13 per cent, Urban Development Institute of Australia chief executive Debra Goostrey said.

“First homeowners have been returning to the market, with the highest number of First Home Owner Grant applications being received since the end of the FHOG boost in 2010,” Ms Goostrey said.

“Affordable options for first homebuyers include apartments, townhouses and smaller attached dwellings and this is where the bulk of the approvals were last month.

“We expect that detached, private housing approvals will improve over time as the existing market normalises and second and third homebuyers re-enter the market.”

Ms Goostrey said the UDIA’s development index data showed a 37 per cent rise in land sales in the December quarter.

“The lift in land sales will translate into more housing approvals over the coming months as there is always a delay between land purchase and dwelling approvals,” she said.

New home sales were also up over February, with the Housing Industry Association last week reporting a 12.8 per cent rise in the number of new detached homes sold.

The HIA said although the figures showed the greenshoots of recovery were taking root in WA, there was still quite a way to go to make up for the losses over 2011.

New home sales in the 12 months to February were 8.1 per cent lower than the previous 12 month period, the HIA said.