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Growth in housing finance commitments has slowed dramatically over the past year, new data has revealed.
There were $29 billion of dwelling commitments made in November 2014, according to the Australian Bureau of Statistics.
That marked a 7.7 per cent increase on the previous year, but was well below the 25.5 per cent growth recorded between November 2012 and November 2013.
The owner-occupied share of those dwelling commitments reached $17.3 billion. That represented 4.4 per cent growth over the year compared to 18.7 per cent growth the year before.
Investment finance commitments rose 12.9 per cent to $11.7 billion for the 12 months to November 2014 after jumping by 38.0 per cent for the 12 months to November 2013.
Meanwhile, the number of owner-occupied dwelling commitments in November 2014 fell 1.6 per cent to 52,079, compared to growth of 14.5 per cent the previous year.
Commitments for the purchase of established homes fell 3.0 per cent to 43,054 after increasing 13.7 per cent the year before.
Commitments for the purchase of new homes fell 1.5 per cent to 2,812 compared to the 20.0 per cent growth recorded the previous year.
There were also 6,213 commitments for the construction of dwellings. That marked a 9.3 per cent increase, but was still only half of the 18.2 per cent increase from the previous year.
The Real Estate Institute of Australia (REIA) said these latest housing finance figures reflect moderating activity in the housing market and may point to a rate cut.
“The November 2014 lending figures indicate a moderating market with November being the 10th consecutive month of modest drops in lending levels if refinancing is excluded,” REIA president Neville Sanders said.
“With moderating housing lending, GDP growth below trend and inflation well within the RBA’s target zone, the RBA board should be considering a cut in interest rates at its February meeting.”
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