The demand for home loans lifted 0.3% in October, providing a positive signal for the housing market going into 2015.
According to the figures released by the Australian Bureau of Statistics, lending to owner-occupiers, excluding refinance, eased 1.4% in October. However, lending for housing construction recorded a significant increase over the month. Diwa Hopkins, economist for the Housing Industry Association, said this is positive news for the industry.
“While total lending to owner occupiers, excluding refinancing, eased by 1.4% during the month of October, loans to those constructing a new home expanded by 1.5% to a level that is 14.6% higher than 12 months previously,” she said.
“On the investor side of the ledger, lending for the construction of rental housing or housing for resale remained strong during the month. The value of lending edged higher by 0.5% to be 24.3% higher than a year previously.”
The figures also revealed that the value of all dwelling commitments had enjoyed a notable increase. Jessica Darnbrough, spokesperson for Mortgage Choice, said this reveals some more positive news for the housing industry, amidst the talk of a cooling market.
“The value of all dwellings approved over the month of September increased by 1%,” she said.
“While it would appear that property price growth is starting to moderate, especially in comparison to previous months, the overall trajectory is still upwards. So, with prices continuing to rise – if only moderately – we should expect to see a continued lift in the value of dwelling commitments.”