Ensure you never miss an issue of the
real estate business bulletin
Home loan demand stumbles

Home loan demand stumbles

by Reporter 0 comments

Demand for home loans dived in January as the effect of three consecutive interest rates took its toll on Australians borrowers.

According to data from Loan Market Group, home loan approvals dropped by 40 per cent from its peak in 2009 – the brokerage’s quietest month since January 2006.

"The three successive rate rises in the final three months of 2009 definitely had an impact on homebuyers so we were glad to see the RBA did not put rates up this month," the group's chief operating officer Dean Rushton said in statement.

Last week, the Reserve Bank kept the cash rate at 3.75 per cent, when most economists had expected a further 25 basis point increase.

Mr Rushton said that while there is still a possibility of rates increasing in March, he didn't see the need for a big rise in the cash rate over the course of the year, as it could undermine confidence in the Australian economy.

According to Mr Rushton, the wind back in first home buyer stimulus has also had a stalling affect on homebuyers.

The government's increased first homebuyers' grant ended on 31 December, returning to $7,000.

le>.b-autolinks{text-decoration:underline}.b-autolinkshadowbox { display: inline; position: relative; cursor: pointer; color: #428bca;} .b-autolinkshadowbox:hover > span { display: block !important; } .b-autolinkshadowbox__links { white-space: nowrap; z-index: 999; display: none; left: 0; border: 1px solid #bfbfbf; border-radius: 5px; font-size: 12px; top: 12px;color: #000; padding: 10px; position: absolute; background-color: #FFF; box-shadow: 0px 0px 20px 1px #bfbfbf; } .b-autolinkshadowbox__links > a { display: block; padding: 3px 0; }
Home loan demand stumbles
lawyersweekly logo
promoted content
Recommended by Spike Native Network
Listen to other installment of the Real Estate Business Podcast
reb top 100 agents 2017

The REB Top 100 Agents ranking is the foremost ranking of agents in Australia. It has set the bar for excellence in Australian real estate. To be ranked as an REB Top 100 Agent is the standard real estate professionals strive for. See the full 2018 ranking here!

featured podcast

featured podcast
The difference between an average agent and one who dominates

McGrath Crows Nest’s Peter Chauncy is number 10 in this year’s REB Top 100 Agents ranking. Peter, however, is more likely not surprised ...

View all podcasts

Would you consider working for Purplebricks or a similar 'DIY' model?

Yes (7.2%)
No (80.9%)
Perhaps - make me an offer (12%)

Total votes: 209
The voting for this poll has ended on: July 13, 2018
Do you have an industry update?