Western Australia's owner-occupier market remains has slowed substantially in the past two months with the number of housing finance commitments dropping again in October, though the dollar valued rose slightly.
Western Australia's owner-occupier market remains has slowed substantially in the past two months with the number of housing finance commitments dropping again in October, though the dollar valued rose slightly.
The Housing Industry Association said the slowdown was due to the lack of available developed land and three increases in official interest rates this year.
The data confirms anecdotal evidence, including comments made recently by property leader Nigel Satterley, that the boom was over.
Australian Bureau of Statistics figures show nationally there were 62,342 owner-occupier housing commitments worth $13.78bn in October, compared to WA's 8,500 worth $1.84bn.
Housing finance commitments
WA owner-occupiers - dwellings/$
Oct-2006 | 8,500 $1.84bn |
Sep-2006 | 8,609 $1.83bn |
Aug-2006 | 10,076 $2.18bn |
Jul-2006 | 9,537 $2.09bn |
Jun-2006 | 10,044 $2.09bn |
May-2006 | 10,951 $2.24bn |
Apr-2006 | 8,186 $1.6bn |
Mar-2006 | 9,926 $2bn |
Feb-2006 | 8,658 $1.68bn |
Jan-2006 | 7,604 $1.49bn |
Dec-2005 | 8,475 $1.64bn |
Nov-2005 | 9,044 $1.72bn |
Oct-2005 | 8,057 $1.5bn |
Source: ABS
Below is an announcement from the HIA:
The lack of available developed land and three increases in official interest rates this year continues to show up in updates on the housing sector in Western Australia.
Figures released today for Australia show that housing finance for owner occupiers was effectively flat in October and lending has been trending down since mid year.
Housing Finance for October showed total home lending across Australia fell by the barest of margins, 0.1 per cent, to 61,819 loans. Loans for the construction of a dwelling rose by 0.5 per cent to 4,549 while loans for the purchase of a recently completed home eased by 0.5 per cent to 2,719. In the established home market, loans ticked down by 0.1 per cent to 54,551.
Australia's peak housing body, HIA, said that the lack of suitably developed land and the associated high land costs, higher interest rates, and an excessive regulatory burden were being reflected in lower levels of new home building in Western Australia.
HIA Director of Government and Media Relations, Ms Sheryl Chaffer said that there were signs that the new housing sector was cooling significantly with all the early indicators - new home sales, building approvals, and housing finance - all showing a downwards trend in Western Australia.
"Home buyers are struggling to bridge the deposit gap and that fact, together with supply constraints, suggests a subdued year ahead for new housing activity," Ms Chaffer said.
The proportion of first home buyers increased from 17.4 per cent in September to 17.7 per cent in October across Australia. In Western Australia first home buyers fell from 13.6% to 13.3% in October, having fallen now for the fifth month in a row. Since the beginning of the year first home buyers as a proportion of the market have fallen from 18.1% to the current 13.3%.
"The decline in first home buyers in October is further proof that the market in Western Australia is struggling to remain an affordable option for the first home buyer," said Ms Chaffer.
On a state by state basis, the total number of seasonally adjusted owner occupied housing commitments fell by 8 per cent in Tasmania, by 5.1 per cent in Western Australia, by 4.4 per cent in South Australia, by 1.2 per cent in Victoria, and by 0.7 per cent in the Northern Territory. Increases were recorded in Queensland, up 0.8 per cent, New South Wales, up 1.1 per cent, and the Australian Capital Territory, up 4.2 per cent.