New builds increasing in Australia

Investors looking to buy property in Australia will be encouraged by news that an increasing number of new builds are set to be built in the country. However, the forecast for the real estate sector remains gloomy, with higher interest rates having an adverse effect on the market, the Housing Industry Association (HIA) has claimed. Indeed, expectations of increased rates have really had a negative impact on the market "as a result, the likelihood of a sharp correction in new home building in 2011 is increasing," HIA senior economist Andrew Harvey said. The comments follow an announcement from the Australian Bureau of Statistics (ABS) which revealed that construction approvals increased 9.3 per cent in seasonally adjusted terms in October after falling for the previous six months. According to the ABS figures, approvals increased in New South Wales by 14 per cent, in Victoria by 4.6 per cent, in South Australia by 6.1 per cent and in Western Australia by 2.3 per cent. Meanwhile, on average prices across the country rose by 0.3 per cent in October with Canberra reporting the biggest increase of 1.8 per cent.