\n\tBy Chris Shaw<\/p>\n
\n\tAustralian housing finance numbers softened a little in February, with the number of owner-occupied loan approvals down 1.8%. This followed a 7.3% drop in January and as Westpac notes was a little below the market forecast of a fall of 1.0%.<\/p>\n
\n\tThe major contributor to the fall was a further decline in first home buyer numbers, ANZ Banking Group economist David Cannington noting this sector of the market fell 12.4% for the month. The total fall since October of last year in first home buyer numbers is now 53%.<\/p>\n
\n\tAs Cannington points out, the proportion of first home buyers seeking approvals was down again and at 18.1% this figure is now at its lowest since October of 2008. In other words, approvals for first home buyers are now back to levels prior to the introduction of Government incentives.<\/p>\n
\n\tWestpac expects there will be further falls in this category as some of the gains seen last year would have been buyers bringing forward their purchase decisions to take advantage of the payments on offer.<\/p>\n
\n\tCannington agrees, suggesting further interest rates hikes will also impact on housing affordability and so continue to weigh on first home buyer numbers.<\/p>\n
\n\tHigher interest rates are also impacting on the upgrader market in Cannington's view, as approvals fell in February by 0.3% in value terms. Upgrader approval numbers did rise slightly though and are now up by 2.2% in year-on-year terms.<\/p>\n
\n\tAccording to Cannington, today's data suggests with sustained demand for housing through population growth likely, but a weakening outlook for housing supply, there is the increased risk of house prices showing solid growth in 2010.<\/p>\n
\n\tWhile finance for constructing new dwellings was weaker than for established dwellings in February, Westpac takes the view the revival in construction it had expected for 2010 remains intact. The bank does see scope for the actual data to be slightly softer than it had forecast by the end of the year, though rate hikes appear to be only a fairly mild dampening influence on demand to date in the cycle.<\/p>\n
\n\tOn the housing finance data Westpac notes there was little reaction in currency markets, with early strength today followed by some profit taking. While some more weakness is possible the bank continues to see the Aussie dollar as a buy on dips proposition at present.<\/p>\n
\n\tBond markets also showed little reaction to the numbers, Westpac noting the market is now pricing in a 30% chance of a rate hike when the Reserve Bank of Australia meets next month, down from a 35% chance last Friday.<\/p>\n","protected":false},"excerpt":{"rendered":"
Economist responses to the latest data releases and anticipated monetary policy impact. Housing finance demand in Australia falls again.<\/p>\n","protected":false},"author":9,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[6],"tags":[21,45],"acf":[],"_links":{"self":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/56472"}],"collection":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/comments?post=56472"}],"version-history":[{"count":0,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/56472\/revisions"}],"wp:attachment":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/media?parent=56472"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/categories?post=56472"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/tags?post=56472"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}