Home loans drop 1.5 per cent in March

The number of Australians who took out home loans in March was the lowest recorded in the country since February 2001.

Figures from the Australian Bureau of Statistics revealed that there was a 1.5 per cent decline in the third month of the year, which was significantly lower than the two per cent increase forecast by economists.

However, there was an increase in the proportion of the market share for home loans that was taken up by those purchasing new properties.

With fewer applications approved, those who are in position to get financial backing to purchase a house may find there is less competition for their chosen properties when they come to make an offer.

Adam Carr, economist with market information provider ICAP, told the Australian Associated Press: "Interest rates are in no way clamping down on the lending market at the moment."

He noted that the figures were good news for the Reserve Bank of Australia (RBA) with regards to its interest rates policies.

Three of the big four financial institutions in the country – Westpac, ANZ and the National Bank of Australia – have forecast that the RBA will increase the cash rate in June.

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