Signs of recovery are becoming clearer across the new home sector, following a prolonged period of disruption caused by rising costs, labour shortages, and softer buyer confidence. While overall transaction volumes dipped slightly in November, new home sales have continued to trend higher compared to earlier in the year.
Data from the Housing Industry Association’s monthly survey of Australia’s largest volume builders shows that sales levels are now significantly higher than at the start of the year. Strong results in September and October played a major role in lifting annual figures, providing a much-needed boost to the residential construction sector.
HIA chief economist Tim Reardon says the recovery is becoming increasingly evident in the numbers. Quarterly results are now the strongest seen since mid-2022, marking a turning point after a prolonged slowdown. Sales in the three months to November 2025 were 9.4 percent higher than the previous quarter and 23.7 percent higher than the same period a year earlier.
Several factors are contributing to this improvement. Population growth remains strong, driven by both overseas migration and interstate movement. At the same time, unemployment remains low, supporting household confidence and borrowing capacity. Rising prices in established housing markets are also pushing some buyers toward new homes as an alternative.
Importantly, Reardon notes that demand is not the key issue in the current cycle. Enquiry levels are rising and contract activity is improving across many markets. Instead, the challenge lies in delivering enough new homes to meet demand, particularly as the industry continues to navigate capacity constraints.
Construction timelines remain stretched, and builders are still working through backlogs created during the downturn. However, improving conditions suggest the sector is gradually moving into a more balanced phase. As economic settings become more supportive, confidence among both builders and buyers is expected to strengthen further in 2026.
For buyers considering new builds, these trends highlight the importance of planning ahead and understanding delivery timeframes. While demand is clearly returning, supply constraints mean competition for completed homes and well-located new developments is likely to remain strong.
