Australian new home sales set to boom in 2015: report

Australia's residential market boom is set to continue in 2015 with low interest rates fueling demand for new homes, a Housing Industry Association (HIA) report revealed on Thursday.

The HIA's monthly new home sales report showed the number of sales in 2014 increased by 14.4 percent. Although new home sales for last December fell a seasonally adjusted 1.9 percent, sales increased by 4.9 percent over the December quarter.

New home sales and residential building approvals both saw increases during the December quarter, which are positive indicators for 2015 trends, said HIA economist Diwa Hopkins.

Hopkins said a key change in conditions to the residential construction sector in 2015 is the February cut to the official cash rate to a new historic low.

"This year will be another healthy one for the national new home building sector," Hopkins said in a statement.

"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," Hopkins said.

Western Australia (WA) and Queensland led the nation in new home sales in last December with rises of 2.8 percent and 2.6 percent respectively. Over the quarter, sales rose 13.4 percent in WA and by 11.6 percent in Queensland.

December new home sales declined by 5.3 percent in South Australia (SA) and fell 1.4 percent in New South Wales (NSW). For the December quarter, SA sales dropped 7.5 percent while NSW sales dropped 10.3 percent. Endi