Media Release
12 January 2010
FALL IN LOANS FOR NEW DWELLINGS
AS FIRST HOME OWNER ‘BOOST’ PHASES DOWN
Statement by Peter Jones, Chief Economist
Housing finance
commitments fell again in
November in line with the phasing down of the
Government’s First Home Owner ‘Boost’ Scheme, according to peak building and construction
organisation Master Builders Australia.
Mr Peter Jones, Master Builders’ Chief Economist, said
“Demand for housing finance is
beginning to show the effects of the phasing down of the ‘boost’ scheme, with the proportion of
all dwellings financed by first home buyers down to its
lowest level since October 2008, the
month during which the ‘boost’ was introduced.”
“The recent correction in demand for housing finance comes after a fairly strong growth phase,
but the housing market will increasingly look to upgraders and investors to fill a gap left as the
bring forward of first home buyer demand reverses.”
He said,
“How the market reacts to recent Reserve Bank
rate rises
will also be important in
terms of understanding prospects for housing over the next few months.”
“The investment-driven side of the housing market is still being affected by a lack of project
finance due to the credit crunch, with construction for rent or resale little changed over the year.”
“Master Builders believes the Reserve Bank needs to take a more cautious approach on
interest rates and ensure that recovery in the interest-rate-sensitive residential building sector
becomes firmly entrenched and is able to lead the economy out of the downturn.”
The total number of dwellings financed for owner occupiers, seasonally adjusted, fell by
5.6 per cent in November, to be up 14.1 per cent on November last year.
The number of loans for ‘new’ dwellings
(construction/purchase of
new dwellings,
combined) fell by 6.1 per cent in November to be up 65.3 per cent on the same month last
year:
-
the number of loans for the construction of dwellings
fell by
6.5
per cent in
November, to be up 88.5 per cent on the same month last year;
-
the number of loans for the purchase of new dwellings
fell
by 5.1
per cent in
November, to be up 20.1 per cent up on the same time last year.
The number of loans for the purchase of established dwellings fell by 5.1in November, to
be up 7.4 per cent on the same time last year.
The value of lending to finance the purchase of investment housing rose by 2.1 per cent
in November, to be up 26.1 per cent on a year ago.
For further information contact:
Peter Jones, Chief Economist, Mobile 0403 440 838
NEWS 
