SYDNEY, May 5 (Reuters) - Sales of new homes in Australia surged to a seven-month high in March, an industry survey showed on Thursday, a positive sign for consumer spending and house building.
The Housing Industry Association (HIA) said its survey of large-volume builders showed sales of new homes jumped a seasonally adjusted 8.9 percent in March, from February when they fell 5.3 percent.
Sales of detached homes climbed 7 percent, while sales in the volatile multi-unit sector rose 16.3 percent.
"This is another positive update for the residential construction sector," said HIA economist, Diwa Hopkins.
"The current level and trajectory of new home sales and approvals provides a strong signal that new home building activity in 2016 will remain strong."
Hopkins said the housing market was also likely to benefit from this week's cut in interest rates by the Reserve Bank of Australia (RBA).
The central bank lowered its cash rate a quarter point to a record low of 1.75 percent in an attempt to arrest a troubling slowdown in inflation.