Builders welcomed February's improvement in home loans. Photo / Kerri Jackson
Builders welcomed February's improvement in home loans. Photo / Kerri Jackson
Australia's housing sector is in the tentative stages of a recovery as investors and homeowners take advantage of low interest rates.
The number of home loans taken out in February rose 2 per cent, the first monthly rise since September last year. That is despite the percentage of loans givento first-home buyers falling to its lowest point in nine years.
Of those who took out home loans in February, 14.4 per cent were first-home buyers, the lowest level since June 2004.
St George senior economist Jo Heffernan said the rise in approvals was a sign low interest rates were providing a boost for the housing sector.
"We are expecting to see some further pick-up from here, but we would need to see a few more months' data to confirm a pick-up was underway," she said.
Home prices rose 2.8 per cent in the March quarter, according to property research firm RP Data, while building approvals for new homes rose 3.1 per cent in February, according to the Australian Bureau of Statistics.
Housing is one of several underperforming sectors the Reserve Bank of Australia is counting on to improve during 2013 to help offset an expected slowdown in mining investment.
The RBA cut the cash rate 1.25 percentage points in 2012, bringing it to its current low level of 3 per cent.
But while builders welcomed February's improvement in home loans, they said more needed to be done to stimulate growth in housing construction.
"The concern is today's figure could be another in the volatile series of rises and falls witnessed over the past year," Master Builders Australia chief economist Peter Jones said.
CommSec chief economist Craig James said investors were driving the nascent recovery in the sector. But he added that the continued fall in first-home buyers was a matter for concern.
