Australia’s new home sales remain at elevated levels, despite a 6.4% month-on-month decline in July, according to the Housing Industry Association (HIA).
HIA senior economist Maurice Tapang said the decline was likely due to buyers bringing forward their purchases to capitalise on end-of-financial-year sales in June, rather than a change in underlying demand, as new home sales in the three months to July rose by 15.9% – the highest level since the September quarter of 2022.
If you’re thinking about buying a new home, it’s important to remember that construction loans differ from standard home loans. Here’s how:
- Funds are released in stages rather than as a lump sum
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Repayments usually cover interest only during the construction period
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Interest is charged only on the funds that have been drawn down
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Inspections are carried out before each stage payment is made
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The loan typically converts to a standard mortgage once construction is complete
Please reach out if you’re interested in learning more about construction loans and how they could help you finance a new build.