Landlords are poised to see further increase in rents as the market slowdown continues to spook investors.
The value of new housing finance commitments fell in March according to the latest ABS statistics, dropping by 1.6% in trend terms and 0.1% in seasonally adjusted terms.
Loans for construction saw a 1.1% fall over the month and an 8.1% drop over the quarter in seasonally adjusted terms, while loans for the purchase of new dwellings saw a monthly rise of 2.4% but a quarterly drop of 20.1%.
Property investors continued to shy away from making purchases in March, with the value of investment housing commitments – in trend terms – seeing its second 1.3% drop in as many months.
“The loss of momentum in the housing supply reform process has combined with heightened interest rate pressure to deal a telling blow to new residential construction at the very time when a sustained boost to supply was the required outcome,” said HIA chief economist Harley Dale.
The HIA was particularly concerned by seasonally adjusted figures for the March quarter, which saw the number of owner occupier loans for new housing fall in all states and territories.
The ACT saw the biggest drop of 23.4%, followed by Victoria (17.4%), Queensland (14.9%), Tasmania (13.5%), the Northern Territory (12.1%), New South Wales (10.2%), South Australia (3.4%) and Western Australia (0.5%).
One positive sign however was the increase in the number of first home buyers taking on a mortgage, with their percentage of all owner occupied housing commitments rising from 14.9% in February to 16% in March.
This however is well below both the long-run national average of 20.1%, and the 27.1% figure seen just over a year ago, says the REIA.
“It is positive news that first home buyer numbers have increased (as a percentage of the market) but there is still a long way to go to see a healthy number. The RBA should not see this as a sign to increase interest rates next month,” said REIA President David Airey.
With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now
Top Suburbs :
tweed heads south
Get help with your investment property
Do you need help finding the right loan for your investment?
When investing in property, it is important to make sure that you not only have the lowest available rate that you can get, but also have the correct loan features for your needs.
Just fill in a few details below and we'll then arrange for a local Aussie Mortgage Broker to contact you and work out what features or types of loans are right for your needs. We'll even help with the paperwork. Plus and appointment is free.
We value your privacy and treat all your information seriously - you can check out