Buyer demand for newly built housing has reached its highest level in four years, even as construction and land costs remain elevated relative to long run averages.

REA Group data shows that searches for new homes are strongest in Queensland, which accounted for 31 percent of all new home searches in January, followed by New South Wales at 20 percent and Victoria at 18 percent.

House and land packages are clearly the preferred format, representing 80 percent of searches in the second half of 2025, compared to 13 percent for new units and 7 percent for land only purchases.

REA Group senior economist Anne Flaherty says demand is rebounding after several challenging years for the construction industry, as buyers regain confidence and re enter the market.

Flaherty notes that more prospective purchasers are returning as cost pressures begin to ease and policy support for first home buyers expands, helping offset some of the headwinds experienced earlier in the cycle.

Interest in new housing last peaked in 2020 during the Federal Government’s HomeBuilder program, which triggered a surge in building contracts and project launches across multiple states.

While building costs remain high, the rate of increase has slowed and is now closer to long run averages, and greater predictability around construction pricing is encouraging more buyers to consider new builds once again.