New home sales are strong, as recent figures show an increase for the fourth straight month.
According to the Housing Industry Association (HIA) survey, sales of new homes increased in April to their highest level in 14 months. New homes sales had increased by 0.5 per cent to 8,191 homes, after a 3.1 per cent rise in March. This is the highest since February 2008.
"The combination of low interest rates and the first home boost have lifted prospects for the housing industry, which is expected to convert to a recovery in home building activity from the June quarter of 2009," HIA chief economist Harley Dale said in a statement.
Mr Dale also says that many leading indicators show housing is a promising part of the economy.
The HIA is forecasting new home contracts to increase by eleven per cent, which translates to 6,900, in the second half of 2009.
Building approvals for Australia rose by 3.5 per cent to 10,494 units in March, seasonally adjusted, the Australian Bureau of Statistics (ABS) said last month.
The ABS is due to release a report on April's building approvals this coming Tuesday.
Later today the Reserve Bank of Australia meets to decide on interest rates and if there is another cut announced sales of homes could again rise.