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New home approvals offer hope
Lending for the construction and purchase of new homes by owner occupiers has increased by 1.4 per cent in December 2012, with that sector of the market rising by 8.1 per cent since December 2011.
1300HomeLoan managing director John Kolenda said this number is encouraging amid disappointing overall housing finance figures, which fell 1.5 per cent in December despite the RBA lowering its cash rate to a near record low.
"They [the RBA] have lowered the cash rate by 175 basis points since November 2011, but they damaged consumer confidence in the first place by taking rates up too far over the previous two years,” Mr Kolenda said.
"The rate reductions they have made since then haven't all been passed on in full by lenders and this also has swayed consumer sentiment.
"Unfortunately, the RBA sat on its hands at this month's board meeting waiting for further evidence of an economic turnaround which hasn't eventuated.
"We will have to see if they make any adjustments to the cash rate next month which I anticipate they will do.”