Confidence to drive housing finance increase

by BN17 Jan 2012

Housing finance approvals will continue to increase this year according to mortgage broking group Loan Market.

Following an RBA cash rate cut in early December, chief operating officer Dean Rushton said yesterday that growth seen in the second half of 2011 would continue into 2012.

“The consecutive growth seen in the second half of 2011 should continue while consumers act upon repeated rate cuts by the RBA in November and December,“ Rushton said.

Home loan approval figures for November released by the ABS showed the eighth consecutive month of growth for housing finance, which Ruston said was indicative of the continued trend.

“Consumers will likely remain confident in the housing finance market with the strong possibility of a rate cut in February,” Rushton said.

“This should fuel a significant number of approvals in the coming months, which will stimulate many struggling sectors in the economy.”

Loan Market said it had seen significant demand brought forward in NSW due to the 2011 stamp duty exemption deadline for first homebuyers, which passed on 1 January this year.