Big Drop in Housing Finance

Loans for new homes in Tasmania have drop to their lowest level in three years.

The Tasmanian Housing Industry Association says over the March quarter the total number of loans for construction and purchase of new houses dropped 13.5 per cent.

The association’s Stuart Clues says tougher lending requirements from banks will mean less work for Tasmanian builders.

He says the slump is prompting builders to reduce their prices, which is good news for people wanting to build new homes.

“I would suggest it’s probably the best that they will have seen in probably the last 10 years so for those people that have been putting projects on hold on the basis that builders weren’t available or it wasn’t at a price they were comfortable with,” he said.

“I would suggest that the industry would be most receptive to a call from the right now.

“We would suspect that what that’s showing is a definite softening of the market over the next 12 months.

“So we’re predicting that we’ll probably build around about 200 homes less than what we did last year and probably about $100 million worth or renovations in Tasmania less than what we did last year.”