Major investment will create homes in mining towns

The Queensland State Government has launched a major new house building initiative, which will boost the number of properties available to communities in small mining towns across the region.

It is hoped that the initiative to free up land for construction will help drive down the high rents for working professionals and possibly cut people's monthly outgoings on mortgages and home loans.

In particular, public servants such as the police, teachers and nurses are expected to benefit as the high level of demand for property in mining townships is met.

In a statement the government said: "[Our] plan is to improve affordability prospects by increasing land supply to the general public and deliver more serviced lots within a relatively short period of time."

In total, some 185 housing allotments will be created at a cost of $15 million.

Premier Campbell Newman claimed he was working with regional councils to remove the barriers to residential development. The government was also committed to meeting with key players in the construction sector to ensure that all potential opportunities are explored and that local residents' concerns are dealt with.

Recent figures from the Housing Industry Association have shown that home loan lending in Australia rose dramatically in June of this year.

The organisation's senior economist Andrew Harvey said: "Following relatively weak data in May, the number of loans for the construction or purchase of new homes rose by 6.3 per cent."

However, the highest demand came from New South Wales and Victoria, which saw mortgage lending increase by 7.3 per cent and 11.3 per cent respectively.

Successful home loan applications for existing properties also increased in June, with Mr Harvey noting: "Across loans for new and established property there has been a modest increase for both first time buyers and trade-up buyers over the last year, although it's from a relatively low base."

The figures were still lower than they were at the peak of the property market in 2009.

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