Top 5: Finance & property quotes week commencing January 12

By the resi financial blog team, 19 January 2015

Top 5: Finance & property quotes week commencing January 12

It seems the property and finance markets have awoken from their slumber over the holiday break. This past week reveals some healthy trends for construction and real estate that have emerged from data late last year, with positive implications moving forward.

#1. The Housing Industry Association (HIA) has analysed November 2014 lending figures released by the Australian Bureau of Statistics (ABS), revealing some interesting market trends. While lending for existing homes was down, construction loans increased greatly - portending a solid and healthy pipeline for the building industry, new housing stock and the economy as a whole.

"Fortunately, the flow of loans for new home construction is very solid. The number of new home construction loans in November was 7.6 per cent higher than a year ago," said HIA Senior Economist, Shane Garrett in a January 12 statement.

#2. Home loans are only the beginning for the construction industry and real estate market, as a January 15 statement from the HIA revealed that new home starts reached a record high in the September quarter.

"With New South Wales, Victoria, Queensland and Western Australia, the four largest states, all recording their strongest quarters on record for multi-unit dwelling commencements at the same time, there is little surprise that activity reached a new record. Furthermore, another incremental increase in detached dwelling starts sees this part of the market record the strongest quarterly result since 2010," said Mr Garrett.

#3. While Queensland recorded excellent approvals figures, there were regions within the state that suffered in the same period. Master Builders called for a focus on the construction industry as the 2015 state election looms ever-closer.

"While the industry remains confident about the future, these latest figures for November 2014 show that conditions in many regions are still patchy," said Master Builders' Deputy Executive Director, Paul Bidwell.

"With the State Election 2015 approaching, Master Builders is calling on all parties to commit to initiatives that will chart a course for growth in the building and construction industry."

#4. The Real Estate Institute of Australia (REIA) released a statement on January 12 regarding what it sees as a moderating market for finance and real estate sales.

"With moderating housing lending and GDP growth below trend, inflation well within the RBA's target zone, the RBA Board should be considering a cut in interest rates at its February meeting," said REIA President, Neville Sanders.

#5. RP Data released its latest Pain and Gain report for the September quarter on January 12, and the results showed that while there was a slight increase in re-sale losses since the June quarter, there was significant improvement over the September 2013 quarter.

The official release stated that, "the data shows that the vast majority of re-sales (90.7 per cent) recorded a gross profit over the quarter with 30.1 per cent selling for more than double their original purchase price. The gross profit across all profit-making re-sales was $13.5 billion and the average gross profit across these re-sales was $223,870."

Categories: Home Loans