After a bright future was in sight, sales fell down to near lowest levels with no certainty of comeback
San Francisco, CA -- (SBWIRE) -- 08/31/2012 -- The central bank was supportive of the idea that interest-rate cuts were helping the economy and that it will help to stabilize the housing market. However, the rate of the new-built homes reached the second lowest ever value in July, completely denying the idea of the central bank.
Sales of the newly built houses gained a percentage of 2.8 last month, but this month alone saw a drop of over 5.6 percent. According to a survey done by Bloomberg.com, the Housing Industry Association of Australia, the decrease in the sale of detached houses reached the lowest level since 2000. The Housing Industry Associations’ chief economist, Harley Dale, said in a briefing,
“New home building is the weakest sector of the Australian economy. Interest rates are lower, it’s a very competitive market, and there is less pressure on skilled labor availability. However, consistently weak consumer and business confidence is weighing very heavily on new housing investment.”
The slump in the Australian Construction Industry suggests that the mining-investment boom has reached its peak. The nations biggest commodity, iron ore, is facing a slump, while Treasurer Wayne Swan reiterated today to deliver the first budget surplus in five years. It sounds very interesting to hear such motivation from the Treasurer when the local currency has declined for the fourth straight day at the trading market.
Swan said in a media briefing that,
“Our budget will be returned to surplus, as forecast, on time, as promised. Iron ore prices are down, and they’re down more than people would’ve expected, but you can’t then draw a conclusion that that’s where they’ll stay for the next three months, six months or nine months.”
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