Construction loans rise around Australia

The latest data from the Australian Bureau of Statistics indicates home loans for new dwellings are on the rise around Australia. 

According to the figures, the number of loans for the construction of new homes increased by 0.9 per cent from April to May of this year. This makes a total increase of 3.1 per cent over the three months prior to May. This news will no doubt be interesting to builders and tradies around the country, who are likely to continue seeing demand for their services in the near future.

"Construction loans, the principal component of new home lending, are at their highest level in over four years," commented Housing Industry Association (HIA) Chief Economist Dr Harley Dale in a July 11 release.

"New dwelling commencements are on track to hit their second highest level on record in 2014."

What's more, this uptick in new home lending was not concentrated in one place but was rather witnessed across the country. Over the three months to May, the HIA recorded seasonally adjusted increases in Tasmania, Queensland, Victoria Western Australia and New South Wales.

Tasmania topped the list, with a rise of 13.8 per cent, while WA and Queensland saw substantial increases of 8 per cent and 7.6 per cent, respectively. Victoria rounded out the list with a modest rise of 0.6 per cent. 

Dr Dale also pointed out that loans for alterations or additions are recovering from a low in February this year. This could present opportunities for employment, whether the work happens to be air conditioner installation or putting in a new bathtub. 

"The total alts and adds market hit a decade low in 2013 and a turnaround this year would clearly be a desirable outcome," commented Dr Dale. 

"With low interest rates and the recurrence of capital gains, there is the opportunity for the alts and adds market to gather upward momentum."

Whether it does or not, we're sure to find out soon.