Australia records stagnation of home loan approvals

The number of home loans approved in Australia in June remained steady, new figures released by the Australian Bureau of Statistics have shown.

It was found that the number of mortgages being taken out to build or buy properties had remained unchanged from the figure seen in May, when there was a 2.8 per cent increase, Bloomberg reports.

David Cannington from Australia & New Zealand Banking Group said the new data bodes well for housing finance.

"A downward bias to mortgage rates should provide a moderate boost to current weakness in housing market sentiment," he added.

Earlier this week, rates for home loans at Australia's two biggest lenders were slashed.

The Commonwealth Bank of Australia and Westpac both acted to reduce rates in what was viewed as a forerunner to central rate reductions from the Reserve Bank of Australia.

Meanwhile, Shane Oliver from AMP Capital Investors recently said that house prices may fall if the economy is negatively affected by economic turmoil.

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