Western Australian home loan approvals rose in May, with loans for new dwellings reaching 19 year highs
The number of loans for homes purchased by owner-occupiers rose 4.0 per cent in seasonally adjusted terms compared to April, according to figures published by the Bureau of Statistics today.
Loans for the purchase and construction of new dwellings increased 4.7 per cent.
Urban Development Institute of Australia (WA Division) CEO Debra Goostrey said that more than 19,000 loans for new dwellings for owner-occupation were written over the past twelve months, which is 30 per cent more than levels a year ago.
“These are the highest levels since 1994, surpassing the 09/10 peak driven by the Commonwealth Government’s temporary construction stimulus and the mid-2006 peak,” said Ms Goostrey.
“We’ve seen the market balance change dramatically over the past 18 months, encouraged by a strong lift in home-ownership.”
“Developers have reported strong sales in 2013 and releases brought forward are being snapped up quickly by purchasers eager to take advantage of near-record low mortgage rates.”
Ms Goostrey said that strong interest in new dwellings has been driven in part by record migration and a structural undersupply of dwellings.
“Western Australia had an undersupply of 38,000 dwellings in 2011 according to the National Housing Supply Council and since then the state’s population has been increasing at over 1,500 people each week,” said Ms Goostrey.
Figures published last week by the Bureau of Statistics showed that dwelling approvals increased for the tenth consecutive month in May, reaching 24,000 dwellings over the twelve month period.
Ms Goostrey said that UDIA is working with a whole range of government agencies to prevent a return to severe land shortages that were characterised by a destabilising overshooting of land prices in the middle of last decade.