sydneysales of new homes plunged across australia in october as a record pace of interestrate increases since may and surging construction costs chased buyers away sales of new homes fell by 228 in october compared with september with all regions hit hard the housing industry association said thursday sales of new homes had already fallen 158 in the three months to the end of september due to increases in the cash rate starting in may 2022 according to the association which represents home builders the reserve bank of australia has added 275 basis points to the official cash rate since may with further hikes expected in december and early next year the increase in interest rates is compounding the rise in the cost of newhome construction and further reducing the capacity of borrowers to finance the build of a new home said tim reardon chief economist at the association despite the fall in sales over the past four months a significant volume of home building is under way and many homes are still to commence construction he added this will ensure that work on the ground remains strong through 2023 mr reardon said the consequence of the fastest increase in the cash rate in almost 30 years will see detachedhome building activity slow to its lowest level in a decade by 2024 he said for the three months to october compared to the previous three months new home sales in queensland were down by 319 the number for victoria was down by 228 new south wales was down by 196 and western australia new home sales were down by 91 the housing industry association report showed south australia saw the only increase rising by 139