Heritage Bank CEO John Minz says lender competition and low interest rates have contributed to a strong demand for housing and the recent increase in the number of loans approved for new houses.
New data released by the Australian Bureau of Statistics has revealed that the number of loans issued to owner occupiers for new homes is at its highest level in four years, up by 5.8 per cent since December 2013. The value of loans for new and to-be-built housing is up 15 per cent, or more than $400 million a month, from January last year.
Mr Minz said that the increase in home loans showed encouraging signs for the housing and construction industry.
“The research shows that new home loans for owner occupiers are continuing to build on the stronger gains made over the past few months,” Mr Minz said.
“This marks a promising start to the year for the residential construction industry which is still recovering from a downturn in activity.”
Mr Minz also pointed to current low interest rates from financial institutions supporting the demand for housing and home loans.
“Many lenders have recognised the demand for housing and are offering a variety of discounts and lower rates for home loans.
“Consumers are currently spoilt for choice when it comes to choosing a lender and customer-owned financial institutions like Heritage Bank are offering extremely competitive home loan packages at fixed rates under five per cent.
“There are so many different options available so it’s important for home buyers to shop around to find the best option for their particular circumstances.”