Australian Housing Finance Is Down Again

Latest housing finance data from the ABS continues to document the slide in the housing sector (ABS release here).

The floods across the East coast are being pointed at as culprit – perhaps there will be a bounce-back once the rebuilding commences (to the extent there is rebuilding as opposed to a good hard scrub).

Still, another interpretation could be that the more recent softness is just a continuation of the downtrend that has been underway for some time.

housing

Photo: Rohan Clarke

Certainly, if you place this data against the most recent building approvals (ABS release here), the argument that housing construction has passed a cyclical peak looks to carry some weight.

housing

Photo: Rohan Clarke

With the average size of loans confirming the retreat – and even if you don’t subscribe to the theory that debt needs to keep rising to sustain the building industry – it’s hard to see any growth in the sector any time soon.

housing

Photo: Rohan Clarke

Heaven help us if our terms of trade should falter, cause without the China machine to feed, we’ll be waving goodbye to the two-speed economy for all the wrong reasons.

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