Housing loans down for March
A slowdown in lending for March according to figures published by the Australian Bureau of Statistics (ABS), show interest rates rises are having the desired effect.
Finance for owner-occupied housing dropped 3.4% to $13.534 billion, finance for construction of new houses dropped by 7.3% to $5.8 billion, while finance for the purchase of new homes dropped by 3.2% to $2.09 billion. Finance for purchases of established homes also fell by 2.9% to $40.31 billion.
Lending finance is down 12 per cent on a year ago, recording its weakest annual growth rate in 13 months, CommSec economist Savanth Sebastian said.
Experts believe that continuous interest rate rises and strong price growth is the trigger for the change in the lending landscape. In fact, statistics from Australian Property Monitors, RP Data, Rismark and the ABS show house prices faired quite well through the economic storm, increasing by as much as 20% over the past 12 months.
Economist Matthew Bell from Australian Property Monitors suggests price growth should moderate over this year in light of affordability.
“I do expect price growth to actually fall during the next two quarters, as opposed to seeing actual price decreases. I think we are seeing pretty strong auction results and clearance results, and so price growth will moderate rather than fall.”