So if a company like Crane Group says it won’t see any benefit from the housing upturn for at least a year (see accompanying story), then the housing splurge must be in its early days.
Crane makes the sorts of products in demand in the housing and construction sector: copper and metal piping and products, plus a wide range of plumbing supplies (and other building products) through its Tradelink arm.
And Bendigo and Adelaide Bank lent more for housing in the second half of the year, despite restrictions on its business from funding pressures. Home loans were lower in the first half and therefore lower for the full year.
According to official figures yesterday nearly $12 billion has been approved for new home building since last October.
Only a few of the thousands of new houses ordered have been built or started on, so the boost from the first home buyer (construction) grants is obviously still a long way from impacting on the wider economy.
June figures on home lending from the Australian Bureau Of Statistics suggested yesterday that the first home buyer rush may be exhausting itself.
Overall, the number of home loans rose for an ninth month in a row to more than 65,000, compared to May’s rise of 2.2% and market estimates for a rise of 1.8%.
The ABS figures showed a fall in the proportion of first home buyers of all home loans approved in June, the first drop for some months. There was a rise in the number of new home building loans granted and in the amount of the loans involved for the seventh month.
But what seems to be happening is the home loans for existing home owners buying is on the rise.
This would support anecdotal evidence of rising clearance rates and prices in the past few months and the latest home price index from the ABS last week which showed a rebound in the June quarter.
The ABS said that seasonally adjusted the total value of dwelling finance commitments excluding alterations and additions rose by 0.3% in June over May.
"Owner occupied housing commitments rose 1.0%, which was partially offset by a fall in investment housing commitments, down 1.8%," the ABS reported.
The actual figures showed that the number of new home construction loans approved in June was 6,400, the highest since the first home buyers grant was introduced late last year, with a total of $1.586 billion in loans approved, which was also the highest ever.
That takes the amount approved in total since last October, when the scheme was first announced, to over $11.5 billion, much of which has yet to be spent.
The impact of the first home buyers’ grants can be seen in the figures for the year to June.
The number of new home building loans has jumped more than 50% from the 4,118 approved in June of 2008, while there has been a similar 50% rise in the monthly value of loans approved from $1.027 billion a year ago to more than 41.5 billion in June of this year.
The number of loans approved to buy new homes fell marginally in June to 2,635 from 2641 and the amount involved fell to $751 million from $756 million.
But the number of loans approved to buy existing homes jumped to 56,111, the highest for well over a year, from 55,555 in May. The value of loans approved jumped to $14.49 billion from $14.81 billion.
Compared to the figures for June 2008, the number of loans to buy existing homes is up 40%, or 11,584 and the amount involved is also up around 40% or $4 billion over the 12 months.
The growing importance of non first home buyers can be seen from the ABS figures which showed that the number of first home buyer commitments as a percentage of total owner occupied housing finance commitments decreased from 28.5% in May 2009 to 27.1% in June 2009.
That’s the first fall in that figure for some months. The figure was 17.6% in June of last year.
And, despite all the talk of rising loan debts being taken on first home buyers, the ABS said the average size of home loans fell sharply in June.
"Between May and June 2009, the average loan size for first home buyers fell $11,600 to $270,200. The average loan size for all owner occupied housing commitments fell $1,100 to $264,300 for the same period."
As well, home buyers are starting to think that interest rates have bottomed (as they have from the Reserve Bank’s latest statements).
The ABS reported that in original terms, the number of fixed rate loan commitments as a percentage of total owner occupied housing finance commitments rose from 6.2% in May 2009 to 8.0% in June 2009.
NSW was the only state to see a decline, down 0.1% seasonally adjusted.
Tasmania jumped 17.9%, followed by Western Australia up 3.5% and Queensland and Victoria both up 1.5%. South Australia edged up 0.6% while the small Canberra market saw a 5% rise.
