Housing finance commitments top decade averages across Australia
Housing finance commitments have soared across Australia, surpassing decade averages despite the impacts of COVID-19, a new report has revealed.
CommSec’s latest State of States report has revealed that the value of housing finance commitments has surpassed decade averages in all of the eight Australian states and territories, up from seven economies in the previous quarter.
Home loans, too, were above year-ago levels in all economies, equal to the outcome in the previous report.
Based on the latest data, Queensland has replaced Tasmania to occupy the top spot with the value of home loans up by 65.5 per cent on the long-term average.
“Housing finance is not just a leading indicator for real estate activity and housing construction, but it is also a useful indicator of activity in the financial sector,” the report said.
Following Queensland is NSW with 60.5 per cent, ACT with 57.7 per cent and Tasmania with 52.3 per cent.
Meanwhile, housing finance commitments were up in Victoria by 38.7 per cent on the decade average, followed by Western Australia (up 45.9 per cent) and South Australia (up 47.1 per cent).
Northern Territory was the weakest for housing finance, with commitments only 27.8 per cent higher than the decade average.
Tasmania keeps top spot in dwelling commencements
In terms of dwelling commencements, Tasmania remains in the top spot, with starts 23.5 per cent above the decade average on the back of above ‘normal’ population growth and relatively low home prices.
This is followed by a wide gap to Victoria, which saw dwelling starts rise by only 2.9 per cent.
“Starts are driven in part by population growth and housing finance and can affect retail trade, unemployment and overall economic growth. However, any over-building or under-building in previous years can affect the current level of starts,” according to the report.
The rest of the states and territories saw dwelling commencements decline, with South Australia’s starts down by 0.6 per cent on the decade average and NSW’s starts down by 9.3 per cent.
Dwelling starts in the Northern Territory were 64.4 per cent below the decade average, followed by Western Australia (down 41.3 per cent), the ACT (down 40.5 per cent) and Queensland (down 22.1 per cent).
According to the report, in four of the states and territories, construction work was higher than the decade average, down from five economies in the previous quarter.
Victoria retained the top spot with construction work done 18.8 per cent above its decade average. Tasmania was next strongest, 11.2 per cent above the ‘norm’ or decade average, followed by NSW (up 9.6 per cent).
At the other end of the scale, Northern Territory construction work done in the September quarter was 65 per cent below the decade average.
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