Market starts year on mixed news

While the property market recorded negative growth in 2012, there were some positive signs at the end of the year.

Australian Bureau of Statistics property data shows home loans were up 1.4% in November and loans to property investors rose 1.8%.

Property market experts said these statistics reflect an increase in inspections by first homebuyers and to a lesser extent investors in the last two months of 2012, encouraged by two consecutive interest rate cuts. However the wider household market still appears to be concentrating on paying down debt and avoiding new borrowings.

The financial markets are expecting further RBA rates cuts in 2012, starting with the Board’s meeting on February 7. This could set the scene for house price growth to emerge in 2012.