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The Real Estate Institute of Australia (REIA) says that the impending federal election is starting to have an impact on the housing market.
Commenting on the latest loan figures from the Australian Bureau of Statistics, REIA president Hayden Groves put a recent fall in new housing loan commitments down to pre-election jitters.
He said the recent decline could be largely attributed to first home buyer activity losing steam, with the group recording an 8.3 per cent drop in the number of new loans disbursed in the past month – 36.7 per cent lower compared to a year ago.
He noted that REIA’s own data backed up the findings.
“According to our Housing Affordability Report, the number of first home buyers decreased to 37,620, a fall of 0.4 per cent during the quarter with first home buyers now making up 34.1 per cent of owner occupier dwelling commitments, a decrease of 78 percentage points of the year,” he said.
The latest data from ABS painted a picture of a nationwide trend, he said.
“Falls in the number of owner-occupier first home bury commitments were seen across all states and territories,” he noted.
By and large, it was owner-occupiers who appeared to have their confidence shaken in the past month, with falls in the value of loan commitments to that group down in most states and territories, especially NSW (a 10.5 per cent drop) and Victoria (down 5.2 per cent).
Investor lending recorded a 1.8 per cent decrease in value across the nation.
But Mr Groves said that to a certain extent, this was to be expected with the next election in sight.
“Despite these early signs of a usual softening pre-federal election, the market is still historically very strong and investors in particular should continue to buy with confidence knowing negative gearing now has bi-partisan support,” he said.
ABOUT THE AUTHOR
Juliet Helmke
Based in Sydney, Juliet Helmke has a broad range of reporting and editorial experience across the areas of business, technology, entertainment and the arts. She was formerly Senior Editor at The New York Observer.
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