Number of Home Loans Falls

Home Loans 1Home loans by value fell in Octo­ber and remained flat over the year, sug­gest­ing the hous­ing sec­tor remains stagnant.

The Aus­tralian Bur­eau of Stat­ist­ics (ABS) said on Monday that total hous­ing fin­ance by value fell 2.5 per cent in Octo­ber, sea­son­ally adjus­ted, to $20.458 billion.

The ABS data also showed that the value of home loans was largely unchanged from Octo­ber 2010, when it was repor­ted at $20.593 billion.

The num­ber of home loans approved in Octo­ber 2011 rose 0.7 per cent.

National Aus­tralia Bank chief eco­nom­ist Robert Hende­r­son said Monday’s data showed the hous­ing mar­ket was still deteriorating.

Mr Hende­r­son said it was a fairly dis­mal report on the hous­ing mar­ket, with fall­ing lend­ing in value terms and con­struc­tion and invest­ment lend­ing both weak.

Recent data, includ­ing the national accounts fig­ures released last week, have high­lighted the weak­ness of the hous­ing sector.

It is clear that over the fore­see­able future Aus­tralia will fall well short of build­ing the num­ber of new homes required for both owner-occupiers and renters,” Hous­ing Industry Asso­ci­ation chief eco­nom­ist Har­ley Dale said.

Amidst the grow­ing risks to our eco­nomy from the situ­ation in Europe, now is the time to be provid­ing stim­u­lus to the new home build­ing sec­tor while at the same time rein­vig­or­at­ing the hous­ing sup­ply reform pro­cess, which cur­rently lies dormant.”

Com­mon­wealth Bank of Aus­tralia senior eco­nom­ist Michael Work­man said Monday’s ABS fig­ures were a little softer than he expected.

If you go back and look at the data over the last 15 years or so, hous­ing credit growth still remains excep­tion­ally weak.

So, for the hous­ing mar­ket, it’s strongly biased towards the buy­ers rather than sellers and it looks like it’s going to stay that way.”

Mr Work­man said the Aus­tralian dol­lar and local bond futures were largely unaf­fected by the data.

RBC Cap­ital Mar­kets fixed income and cur­rency strategist Michael Turner said the Octo­ber hous­ing fig­ures were a little dated.

China has already repor­ted trade data for Novem­ber, and the fin­ance data do not reflect the Novem­ber and Decem­ber (mon­et­ary) policy eas­ing (in Aus­tralia),” he said.

As such, there are lim­ited implic­a­tions for markets.

We expect more timely domestic data to bet­ter reflect the soften­ing in global growth in com­ing months, which should jus­tify fur­ther eas­ing (of interest rates) and a move to accom­mod­at­ive ter­rit­ory in 2012.”

ICAP senior eco­nom­ist Adam Carr said the hous­ing data showed the Aus­tralian lend­ing mar­ket was recov­er­ing even before the Reserve Bank of Aus­tralia (RBA) cut interest rates.

The cash rate is now at 4.25 per cent after two con­sec­ut­ive 25-basis point cuts in Novem­ber and December.

The 50-basis points worth of cuts we’ve seen will likely see lend­ing growth accel­er­ate over com­ing months, which will start to add to the strong private demand num­bers we’ve seen to date,” Mr Carr said.

Story source:


Jhai is an award win­ning Inter­net Mar­ket­ing Real Estate Agent for Eld­ers Toongab­bie and Kings Langley. After run­ning his own inter­net mar­ket­ing busi­ness he has now set his own sites for the real estate industry. He observed that 90% of real estate agents did not know how to mar­ket them­selves online. Jhai is now fixed on one goal. To teach real estate agents that they can mar­ket online so much bet­ter than they cur­rently are.

Since then he has been con­sist­ently quoted in the Sydney Morn­ing Her­ald and Real Estate Busi­ness online. He is a reg­u­lar guest blog­ger on, shar­ing his expert­ise of mar­ket­ing aspects for the Real Estate Industry. His biggest pas­sions are his wife, mar­tial arts, dogs and most of all property.

seven hills real estate agent NSW
Cnr Federal Road Prospect Highway Seven Hills NSW 2147 Australia