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    New home lending stays strong into new financial year

    Published on 9 September 2014, Tuesday, 10:37 PM

    Those concerned about the health of the construction industry will be rallied by the most recent figures released by the Australian Bureau of Statistics (ABS), which indicates a strong market for new homes across the country.   

    Those working with diggers, dumpers and excavators will be heartened by the fact that new home lending in the three months to July climbed 1.9 per cent, while the number of loans for new houses over the three months to September was  8.8 per cent higher than the same period in 2013.

    This was particularly the case in New South Wales, where owner-occupier loans for new houses were 9 per cent higher over July. Investors were also driving the increase in home construction, however.

    "Lending to investors constructing new homes made a strong recovery throughout the 2013/14 financial year and today's data reinforce the strength of that improvement," said HIA Economist Diwa Hopkins in a September 9 release. 

    "The value of this investment lending component in the three months to July 2014 is 10.5 per cent higher than in the same period in 2013."

    The HIA believed the exceptionally low interest rates currently prevailing throughout the housing market were a major factor behind the rise in new lending. Buyers of all kinds were taking advantage of the favourable credit conditions to add to the volume of housing in Australia. 

    Master Builders Australia Chief Economist Peter Jones also commented on the figures, noting the strength of investment activity. 

    "Investors continue to drive growth with the value of investor housing up 6.8 per cent seasonally adjusted and 30 per cent through the year while the value of investor loans for the construction of dwellings is up 43 per cent through the year," he noted in a September 9 release. 

    While acknowledging the sector had experienced some dips, Mr Jones also argued that the strength of housing commitments would help bolster building across the coming three years. Therefore, even with a maturing construction sector recovery, tradespeople won't be lacking for employment. 

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    Nathan Mills
    Nathan is a seasoned Kennards Hire team member passionate about empowering DIYers in their projects. He loves everything DIY and brings together years of equipment and project experience to help customers get the right tools for their next job.