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Housing on the rebound
Monday, March 16, 2009
A slump in new housing loans was arrested in the last quarter of 2008, according to research and consultancy firm Market Intelligence Strategy Centre (MISC).
MISC said that despite reports that borrowers had been reluctant to return to the mortgage market, the market actually rebounded by 12 per cent in the three months ended December.
'This ends a five-quarter negative slide in new mortgage business,' MISC said in its Home Loan Monitor released on Monday.
'The 12 per cent rise in the value of new mortgages settled was reflected through an additional 21,000 new mortgages that were settled by borrowers in the months October, November and December 2008.'
MISC said the turnaround reflected three interest rate cuts totalling 2.75 per cent in the quarter, and the government's enhanced housing incentive package for first-home buyers.
There was also anecdotal evidence to suggest that demand for mortgages was boosted by builders discounting on new homes and stronger demand and investment in rural Australia.
'The results stand in contrast to numerous reportings of a worsening total mortgage business in the December 2008 quarter,' MISC said.
MISC said the upturn should continue in the March quarter as the impact of the first home owners grant continued to flow through.
Bigpond News