The Housing Industry Association (HIA) cites the latest housing finance data released by the Australian Bureau of Statistics to show growth in home lending in the final quarter of the 2013/14 fiscal year.

HIA Economist Diwa Hopkins explains that the owner occupier segment of new home lending performed well throughout the 2013/14 fiscal year. While the December and March quarters registered decent increases, lending for the purchase or construction of new homes increased again during the June 2014 quarter at a more modest pace of 1.0 per cent. 

Viewed over the full 2013/14 fiscal year, new home lending increased by 12.0 per cent. Low lending rates and rising turnover in the established home market as well as home prices have seen a corresponding positive response from the residential construction industry.

With new home lending being a leading indicator of residential building, the latest housing finance figures suggest home building activity will continue its strong recovery through the second half of the year.

The seasonally adjusted number of loans for construction increased by 1.1 per cent in the month of June 2014 and was up by 0.7 per cent over the June quarter. Loans for the purchase of a new dwelling increased by 4.6 per cent in June, and 1.6 per cent over the quarter.

The performance of different states over the three months to June 2014 shows an increase in the number of loans for new housing: New South Wales (+2.0 per cent); Victoria (+0.3 per cent); Queensland (+11.3 per cent); Western Australia (+9.1 per cent); and Tasmania (+13.4 per cent). The same period saw the number of new housing loans decline by 0.8 per cent in South Australia.