Australia's new home sales in June snap 2 months of weakness

New home sales in Australia in June snapped two prior months of weakness, pointing towards a revival in the country’s economically important housing market. House prices and auction clearance rates are seen climbing at a steady clip following the RBA’s most recent rate cut in May.

Australia’s new home sales jumped a seasonally adjusted 8.2 percent in June, more than making up for a 4.4 percent decline in May, data released by the Housing Industry Association (HIA) showed Monday in its survey of large-volume builders. Sales of detached homes climbed 7.2 percent, while apartment sales surged 11.5 percent.

In addition, multi-unit sales jumped 11.5 percent, following a 4.9 percent gain in May, outpacing a solid 7.2 percent lift in sales of unattached houses. Elsewhere sales rose 9.1, 7.5, 3.7 and 2.2 percent in Western Australia, New South Wales, South Australia and Victoria respectively.

Comparing the June quarter this year to the same period last year, detached house sales are down sharply in South Australia by 21.4 percent and in Western Australia by 27.5 percent; yet sales are up by 17 percent in Victoria and by 7.1 percent in Queensland, the HIA report added.

"The overall trend is still one of modest decline for New Home Sales, but a bounce of 8.2% in June 2016 highlights the resilience of the national new home building sector," said Harley Dale, Chief Economist, HIA.

Meanwhile, the Australian Bureau of Statistics will release building approvals data for June, a lead indicator for future new home sales and construction activity on Tuesday at 11.30am AEST.