 Home loan approvals decline
A dip in home loan approvals during July indicates that first home buyers are less keen to buy.
First home buyers led the July decline. Loans to first time buyers as a percentage of the total loans issued fell to 25.7 per cent in July. If this is compared with June which saw 27.1 per cent and 28.5 per cent in May, the fall is minor but noticeable.
Westpac are optimistic in saying that due to a high number of new loans approved in the first six months of the year, the construction industry should be busy for the time being.
"Disappointingly, lending to Investors fell by 4.0 per cent in July. Investors have yet to move back into the housing sector in a major way, with lending up just 5 per since last September," wrote the Westpac economists.
"We expect investor finance to strengthen in coming months, although tighter lending standards will continue to be a constraining factor."
The boost to the first home owners grant is being reduced gradually, and will be back to original levels by January 2010.
These new figures are almost at expectation, and are due to the deadline for the First Home Owners Boost nearing.
Spiros Papadopoulos, NAB's senior economist thinks the idea of rising rates could be putting people off investing in property.
Non-bank lenders have reported a slight increase in the number of loans approved, around 0.2 per cent, while the number of loans issued by the banks fell 2.3 per cent in July (seasonally adjusted).
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