Powered by MOMENTUM MEDIA
SUBSCRIBE TO OUR NEWSLETTER SIGN UP
Powered by MOMENTUM MEDIA

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.

Housing commitments hit year-low

Staff Reporter 4 minute read

By: Belinda Luc

Housing finance commitments have slumped to a 12-month low, suggesting that owner-occupier borrowers are starting to feel the pinch of rising rates.

According to the Australian Bureau of Statistics (ABS), the total value of owner occupied housing commitments dropped from $16.657 billion in March 2009 to $13.534 billion in March 2010.

The fall signals the lowest value of total owner occupier home loan commitments since November 2008, when the figure was $13.063 billion.

Advertisement
Advertisement

Over the month, the number and value of commitments for owner occupied housing finance also fell by 3.4 per cent.

Previously strong property markets such as the Northern Territory, Western Australia and South Australia posted the highest falls in March at 12.1 per cent, 6.8 per cent, and 5.6 per cent respectively.

REIA president David Airey said the nation's owner occupied housing committments were down to the levels recorded at the beginning of the global financial crisis.

“Each month it looks more and more like first home buyers are a dying breed,” Mr Airey said.

Meanwhile, Housing Industry of Australia (HIA) chief economist Dr Harley Dale said the downward trend in new home lending may have a flow-on effect to developers, constraining the housing construction sector.

PROMOTED CONTENT


“We have a debilitating confluence of higher interest rates, tight credit availability, and obstacles related to land supply, planning, and infrastructure charges and taxation,” Dr Dale said.

“These forces are standing in the way of a sustainable lift in new construction in 2011,” he said.

However, the news isn't all glum. ABS figures show investment finance commitments rose by 3 per cent to $6.644 billion in March 2010.

Housing commitments hit year-low
default
TheAdviser logo

If you’re feeling overworked and overwhelmed in this fast-paced mortgage market, it’s time to make some changes, and the Business Accelerator Program can help! Early bird tickets are on sale now. Work smarter, not harder, this year.

default

 

more from the adviser
uptick graph Non-majors and non-banks continue to dominate: Broker Pulse

A greater proportion of brokers are sending their clients to non-...

construction equipment ta Demand for excavators up 191% YOY: CBA

The major bank’s data has revealed a jump in asset finance grow...

mortgage money house Hot Property: The biggest property headlines from the week 7-11 June

The weekly round-up of the biggest news stories from across Momen...