New home sales hit 16-year low in February New home sales in February at the lowest annual level in 16 years. Photo: Brendan Esposito Australia's new homes market has suffered a setback on its mooted road to recovery, with sales falling for the first time in four months. New home sales slid 5.3 per cent nationally in February, driven by sharp falls in Victoria and South Australia, according to the Housing Industry Association. Victoria's detached new homes market is extremely sick The New Home Sales report, which is based on a survey of the country's largest volume builders, also found that unit sales were down 11 per cent compared to 4 per cent for detached homes. "The broadly based decline in activity during February is a reminder of how delicate the nascent recovery in the housing industry really is," HIA economist Shane Garrett said. MacroBusiness economist Leith van Onselen said that sales in the detached new homes market were now tracking at their lowest annual level in the 16-year history of the series. "It's the worst February on record," he said. Victoria posted the weakest performance by far, with detached home sales dropping 13.7 per cent. "Victoria's detached new homes market is extremely sick," Mr van Onselen said, noting that the problem has been exasperated by the cancellation of the $13,000 first home bonus in July last year. The slide has come despite many developers offering steep incentives - including cars, cash rebates and home decorating packages - in bid to entice buyers back into the market. New home sales also fell 6.7 per cent in South Australia and 2.8 per cent in New South Sales. In contrast, the number rose 0.8 per cent in Queensland and 1.9 per cent in Western Australia. Twitter: @chrisvedelago