New home lending up down under

Lending to Australians purchasing or building new homes increased in the first quarter of 2014, according to new figures from the Australian Bureau of Statistics.

Owner occupier lending was up by 3.6 per cent, according to the ABS data, while investor lending increased by 4.9 per cent.

The figures also reveal that residential property prices in capital cities increased by 1.7 per cent during the first three months of the year, to be 10.9 per cent higher than a year ago.

“Following a period of fairly strong increases late last year, prices appear to be growing within a more sustainable range,” commented Housing Industry Association Economist Diwa Hopkins. “Combined with the current low interest rate environment, these developments provide favourable conditions for the residential construction sector.”