New figures show there were 14.2 per cent more home loans issued in Victoria for newly built or off-the-plan homes in January compared to the same time last year.
There were 2058 loans approved across the state in January, up from 1802 in 2013. The news follows a recent climb in home building approvals data.
“We are seeing some really optimistic signs for home builders with approvals and loans climbing at the start of the new year,” said Master Builders’ Chief Executive Officer, Radley de Silva.
“The January figures are the best start to a year we have seen since 2010, which was a bumper year for the new homes business.”
In total, $634.8 million worth of owner-occupier loans were issued for the month, which was $79.3 million higher than the same time last year.
Source: ABS 5609.0
“Last year ended on a very positive note, with the value of home loan commitments in December reaching its best level since August 2012, and hopefully we will now see these commitments turn into solid business prospects for those in our industry,” Mr de Silva said.
The number of first home buyers continues to remain low, however. In January, just 13.2 per cent of owner occupier homes financed across the country were for first home buyers. In Victoria, it was just 12.7 per cent, an increase compared to figures for the end of 2013.
Source: ABS 5609.0
“There has been much talk about property bubbles and rapidly rising home prices that is scaring off potential first home buyers,” said Mr de Silva.
“Now is actually a good time for first home buyers to purchase a new home, with the average loan taken out for off-the-plan homes in Victoria dropping from $291,000 in October to less than $280,000 in January.
“We have seen small increases in the first home buyer percentages in recent months, but they remain much lower than what we have seen in recent years. That’s why Master Builders wants to see an independent review into housing affordability undertaken.”
A Senate inquiry into housing affordability commenced in December 2013, which will examine the taxes and levies imposed by national, state and local governments as well as worldwide best practices for funding affordable housing schemes.
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