Financing activity regarding the building of new homes in Australia has eased back but remains at high levels, the latest data shows.
Housing Finance Data released by the ABS on Tuesday indicates that on a seasonally adjusted basis, the combined number of loans made for the either the purchase or construction of new housing came in at 8,517 – down 0.35 percent compared with November but still almost 15 percent higher than the 7,467 loans approved in the same month one year earlier in December 2012.
Construction industry Economists welcomed the latest data.
Noting a 14.6 percent year on year rise in owner-occupied homes as well as the strongest reading in first-home-buyer activity in four months, Housing Industry Association Senior Economist Shane Garrett said the figures represented ‘a pretty strong result’.
Citing new figures showing median house price growth of 3.4 percent across capital cities in the December quarter, he says this would further reinforce purchaser confidence, albeit with demand needing to be accompanied by further policy action to manage supply side constraints.
“Today’s data cap off a strong year for new home lending and signal that activity on the ground will be strong during the early months of 2014” Garrett said.
Master Builders Australia Chief Economist Peter Jones also welcomed the figures, saying an upswing in housing finance was underway in New South Wales, Western Australia and Queensland whilst Victoria remained steady at healthy levels.
Whilst the latest follow generally soft monthly data over the past week or so, volumes of new work is coming in within the industry remain healthy compared with recent history and economists remain generally confident about the near term industry outlook.
In its most recent forecast, HIA said it expected national housing start levels to remain at levels slightly above 160,000 per annum for the foreseeable future – at or slightly above decade averages (around 155,000 homes) and well above the shocking low of 145,120 in financial year 2011/12.