The downturn in housing could be turning around with new figures showing an uptick in the number of number of Australians seeking home loans in April.
Australian home-loan approvals rose in April by the most since March 2009, the first increase in financings this year according to the ABS.
The number of loans granted to build or buy houses and apartments gained 4.8 percent from March, which had recorded the lowest number of approvals since 1994.
The recovery has been boosted by the Reserve Bank’s decision yesterday to keep interest rates on hold, with the official cash rate at 4.75 per cent.
The sting from November’s double rate rise, first by the RBA and then by the big banks, had begun to dissolve. The RBA had boosted borrowing costs seven times from October 2009 to November to prevent a property-market bubble in a country where more than two-thirds of households own their homes.
Prices declined in the first quarter by the most since 2008 as floods and other natural disasters in Brisbane and northern Queensland had disrupted the property market.
Many analysts had predicted an upturn in April with ANZ’s Dylan Eades noting: “Housing finance is expected to rebound in April as weakness in housing activity following the November rate rise dissipates.
“While house price growth remains weak across the country, increased sales volumes along with robust domestic economic conditions suggest that housing finance commitments will tick up.”
The total value of loans rose 3.8 percent to A$19.8 billion
($21.1 billion) in April, while the value of lending to owner-occupiers gained 6.3 percent, the report showed. The value of loans to investors who plan to rent or resell homes dropped 1.6 percent.
First-home buyers accounted for 15.8 percent of dwellings that were financed in April, down from 16 percent in March and lower than 16.9 percent a year earlier.
