Fed: Home lending falls for first time in almost 12 months - ABS

AAP General News (Australia)
12-10-2003
Fed: Home lending falls for first time in almost 12 months - ABS

Official figures show home loan approvals fell in October for the first time in almost
a year, driven by a drop in people buying established homes.

But the Australian Bureau of Statistics says lending increased for building and buying
new homes, and a record number of people refinanced their homes.

Almost one in three mortgage approvals were for refinancing -- up 3.3 per cent in the
month as homebuyers rushed to lock in fixed interest rates amid expectations of a rate
hike.

And 12.5 per cent of loans approved in October were fixed-rate -- almost double the
same time last year.

Loans to buy established homes dropped 2.7 per cent, while construction loans rose
1.7 per cent and loans to buy newly-built homes jumped 2.7 per cent.

But overall, home borrowing eased 0.3 per cent, allowing for seasonal influences, following
a four per cent jump the previous month.

The bureau says it was the first fall since November 2002.





The average loan size eased back slightly to $187,500 - the first fall in six months
- and the proportion of first home buyers was steady at a record low of 13.4 per cent.

Interest rates rose just weeks later, in November, for the first time in almost 18 months.

And improving conditions at home and abroad prompted another hike earlier this month.

AAP RTV kmh/sb/rt/rp

KEYWORD: HOUSING (CANBERRA)

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