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Record numbers of home approvals, buildings and debt levels has seen the real estate industry surge over the past 12 months despite the COVID-19 outbreak. RECENT data from the Australian Bureau of Statistics (ABS) has shown real estate continues to raise its standing as a favoured investment option for NSW residents. While COVID has caused havoc on the stock market with most shares falling heavily, the past 12 months have seen strong investment in real estate. In the Central West, Bathurst has had two months of 100-plus sales in a row with 102 properties sold in November 2020 followed by 112 in December, a level not seen since 2016/17, while Orange has seen properties listed and sold in excess of $2 million. The Government’s HomeBuilder program, which was extended until March 31, has also helped to drive the real estate industry with approximately 42,000 homes across Australia under construction or rebuild. According to the ABS, approvals for private sector housing rose for the fifth month in a row in November, their highest recorded levels since December 1999. Director of Construction Statistics at the ABS, Daniel Rossi, said that approvals for private houses had surged 40 per cent since June alone. “Federal and state housing stimulus measures and low-interest rates have resulted in strong demand for detached dwellings,” he said. “Approvals for private houses rose 6.1 per cent in November, while dwellings excluding houses remained at subdued levels, falling 3.9 per cent.” READ ALSO: In NSW the number of total dwellings rose 1.5 per cent, while there was also a 5.6 per cent increase in alterations and additions, with the value of residential alterations and additions reaching an all-time high. However, the rise in home constructions and purchases also comes with a growing level of loans with households taking on record debt. The ABS said the total value of new loan commitments for housing and the value of owner-occupier home loan commitments also reached record highs in November 2020. Amanda Seneviratne, ABS head of Finance and Wealth, said that the implementation of the HomeBuilder program coincided with the increase in housing debt. “The value of construction loan commitments grew 5.6 per cent in November, rising 75 per cent since July,” she said. “This follows the implementation in June of the Government’s HomeBuilder grant in response to COVID-19. Loan commitments for existing dwellings rose 5.9 per cent and were the largest contributor to the rise in November’s owner-occupier housing loan commitments, while the total value of new loan commitments for housing rose 5.6 per cent to $24 billion in November, an increase of 23.7 per cent from November 2019. We depend on subscription revenue to support our journalism. If you are able, please subscribe here. If you are already a subscriber, thank you for your support.

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