Early signs show home slump at an end

MORE evidence has emerged that the housing market is emerging from the deep slump in sales activity in the middle of 2000 with the Australian Bureau of Statistics monthly estimate for the number of new home loans rising in December.

Real Estate Institute of WA president Graham Joyce said the prospect of lower interest rates attracted more people to home buying late last year.

“The increase in home loan commitments in December followed a rise in November,” Mr Joyce said.

“The December statistics were also significant because they included an increase in home loans for people building new homes.”

Nationally, there was a 5.1 per cent monthly increase in new home loan commitments in December. In WA, there was a 1.4 per cent increase in December home loan commitments.

Mr Joyce said the recent interest rate cut would boost the already steady recovery occurring in the market.

“We expected a quick improvement after the very sharp slump in sales in the middle of 2000, which was one of the worst recorded,” he said.

The downturn was exaggerated initially by the GST. The recovery was likely to be patchy for the next 12 months, as other economic influences emerge, he said

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