Housing figures give mixed outlook
Clear signs of recovery in the housing market are yet to emerge as the latest figures suggest rate hikes have hit consumers hard.
Home loans for established residences were up by 2.1 per cent in December, but loans for the purchase of new housing were down 10.1 percent, according to figure from the Australian Bureau of Statistics.
A rise of around one per cent in housing finance commitments for owner-occupied homes was predicted for the month, but the total number of loans approved reached 51,706 despite recent rate increases.
Despite the seemingly encouraging figures, loans written for the purchase of new housing were down by ten per cent against November.
Loans for the construction of new houses were also down in December and this represents a cause for concern according to construction association.
"Still suffering from the credit squeeze and bank lending practices, the interest rate sensitive residential building industry needs an extended pause in Reserve Bank monetary policy," said Peter Jones, chief economist of Master Builders.
Mr Jones believes the government must address the shortages in housing in order to prevent the cost of home loans rising even further.