Australia's residential market boom is set to continue this year, with low interest rates and home construction forward indicators both boding well for the housing sector, the Housing Industry Association says.
“This year will be another healthy one for the national new home building sector,” HIA economist Diwa Hopkins said.
The comments come as HIA's monthly new home sales report showed the number of sales in 2014 increased by 14.4 per cent.
While new home sales for the month of December fell a seasonally adjusted 1.9 per cent, sales actually increased by 4.9 per cent over the December quarter.
“Monthly sales volumes remained strong throughout 2014, following the recovery that characterised 2013,” Ms Hopkins said.
The figures topped off a strong year for the new home building sector, which is likely to continue its boom into 2015.
Two key leading indicators -- new home sales and residential building approvals -- both saw increases during the December quarter of 2014, Ms Hopkins said.
"This is a clear indication that actual residential construction activity will rise in the current early months of 2015, which is good news for the broader domestic economy in addition to the housing sector."
For the month of December, Western Australia and Queensland led the nation in new home sales, seeing increases of 2.8 per cent and 2.6 per cent in the month respectively. But over the quarter, sales surged 13.4 per cent in WA and by 11.6 per cent in Queensland.
On the more sluggish side of the market, December monthly sales declined by 5.3 per cent in South Australia and by 1.4 per cent in NSW. These states also performed softly over the quarter, with SA seeing sales decrease by 7.5 per cent while NSW new home sales dropped 10.3 per cent.