Uptake of home loans falls sharply in Victoria

Property sales in Victoria suffered a significant monthly fall in January, prompting calls for further cuts to home loan interest rates.

It seems that the two readjustments made in November and December have not had the desired affect, as Aussies still appear to be reluctant to take out home loans in the current economic climate.

The Reserve Bank of Australia opted not to trim rates further at the start of February, but new statistics compiled by the Housing Industry Association (HIA) showed that this may have been an error.

Indeed, sales of new houses across the state fell by almost 20 per cent in January compared with December 2011, which contributed to a nationwide decline of 7.3 per cent.

Chief economist at the HIA Harley Dale said that Victoria has traditionally held up the Australian property market thanks to strong sales in the area, but this no longer appears to be the case.

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