Property showing regained strength
CENTURY 21 believes the lift in home loans approved over September 2011 could indicate a strengthening of the residential property market.
According to figures released by the Australian Bureau of Statistics, September saw the total number of owner occupied housing commitments increase by 2.2 per cent (seasonally adjusted).
"A lift in housing finance approvals is pleasing to see, particularly given that concerns for global markets heightened over the course of September which saw many prospective buyers hesitant to make a property purchase," said Century 21 co-principal, Sam Marsden.
"While we must remain cautious when viewing these figures, the Reserve Bank's decision to cut rates in November may see the number of home loans granted continue to increase over the remaining months of the year as buyers gain confidence about making a real estate decision."
The ABS data showed a rise in finance acquired by first-home buyers - the number of first-home buyer commitments as a proportion of total owner occupied housing finance commitments rose to 16.4% (September) from 15.4% (August).
While the total value of dwelling commitments increased by 1% (seasonally adjusted), the ABS reported that the average loan size for all owner occupied housing commitments fell by $5400.
"There are unquestionably a variety of factors that continue to play on the minds of many prospective buyers, including uncertainty surrounding Europe's financial markets and affordability concerns - which are likely serving to hold some back from committing to a housing purchase," Mr Marsden said.
"However, with the prospect of rates moving south once again, along with the preference of many to conclude their property transactions before Christmas, there is a certainly a chance that we could see some recovery in the housing market before the year is out.
"Those considering a purchase would do well to explore the new housing finance options on offer as a result of the Reserve Bank's cut to the official cash rate, to determine if more suitable products for their circumstances are now available."