New home lending falls back in Australia
12-07-2012
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Some states saw increases but overall the number of loans for the construction or purchase of new homes fell overall by 2.4% in May.
In seasonally adjusted terms loans increased the most in South Australia, up 9.9%. They also increased by 3.1% in Australian Capital Territory, by 1.7% in Queensland and by 0.1% in Tasmania.
But this was offset by a massive decrease of 23.8% in the Northern Territory, a fall of 6.3% in Western Australia, a fall of 8% in New South Wales and a fall of 0.8% in Victoria.
The quarterly figures were more positive. Tasmania saw a 13.7% rise in new home lending, ACT a 7.6% rise and Northern Territory a 7.3% rise. New South Wales was up 5.8%, Queensland saw a 2.4% rise, South Australia a 2.2% rise, Victoria was up by 1.4% and Western Australia was up by 0.5%.
‘It is disappointing result for May. A modest lift is evident for new home lending over the three months to May this year and that is reflected in increases across all states and territories,’ said Harley Dale, chief economist of the Housing Industry Association, the voice of Australia’s residential building industry.
‘That is a more encouraging outcome, but the fact is new home loans have been grinding higher over the last 12 months rather than mounting a sustained and significant recovery. It is evident that new home starts will bottom at GFC equivalent levels this year, which is a very poor outcome for Australian businesses, households, and therefore the wider economy,’ he added.
He pointed that the industry needed to be seeing a strong recovery in new home lending coming through in the first half of 2012 to signal a significant turnaround in residential construction from what will historically be a very low trough. ‘That simply isn’t the case and government action in addition to lower borrowing costs is the combination required to restore healthy levels of confidence and activity,’ said Dale.
‘Across loans for new and existing property there has been a modest increase for both first time buyers and trade up buyers over
