Home loan approval figures pick up in May

The number of home loan approvals in May rose to the highest level seen in the last two years, new figures reveal.

Data from the Australian Bureau of Statistics (ABS) showed a 4.4 per cent month-on-month rise, taking the total up to 49,437.

Loans for construction also witnessed a surge in popularity in this period, with the ABS figures indicating an increase of more than six per cent.

In total, housing finance was boosted by 2.9 per cent compared to the preceding month, taking it to a seasonally adjusted $20.497 billion.

Speaking to the Herald Sun, HSBC economist Paul Bloxham said home loans customers were regaining confidence following the Reserve Bank of Australia's decision to raise interest rates in November 2010.

"That's what was driving the decline in earlier in the year so this figure indicates a levelling out, back to more normal levels,'' he remarked.

This comes after research director at RP Data Tim Lawless claimed that Aussies are more eager to save money than take out home loans as many are becoming more cautious with their cash.

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