Home loan approvals fall in January

Australian home loan approvals fell in January following a series of home loan interest rate hikes.

According to the Australian Bureau of Statistics, the number of people taking out owner-occupier home loans in January fell 7.9 per cent to just over 51,000.

A rise of two per cent had been expected.

Commenting on the unexpected finding, the Housing Industry Association’s senior economist Ben Phillips said: "The removal of the Federal Government’s first home buyer boost and increasing interest rates have clearly lowered activity in both the new and existing homes market."

In its past five meetings, the Reserve Bank of Australia has increased its base interest rate four times, with last week’s announcement taking it up 0.25 percentage points to four per cent.

The latest AFG Mortgage Index showed that the proportion of home loans issued to investors rose to 34.1 per cent of all mortgages approved in February.

This marked a rise from 27.1 per cent in August last year, the Australian reported.

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