Housing supply increases loans in Australia
Australia's Stockland is the biggest diversified property trust in the country. The company said that housing supply in the country state capitals would help improve the increasing prices in properties. Property prices had been increasing in the cities since the beginning of the year.
The housing and apartment rental rates across the biggest cities in Australia had increased 5% in the year to August 31. This was according to a RP Data-Rismark Home Value index. A data from SQM Research Pty. showed that property prices in Sydney might surge by as much as 20% by 2014. The country's major cities could have an increase in its property prices to as much as 11% on average. The average was based on not more than one interest rate cut of 25 basis points by the central bank of the country, said SQM.
The Reserve Bank of Australia had pushed the country's average standard variable mortgage rate. The 2.5% benchmark rate of the country had moved the mortgage rate down to 5.95%. This was the lowest rate in the country in more than four years. According to a government data, the number of approved loans for the acquisition of new homes increased a seasonally adjusted 43% from a year earlier last July.
Stockland had a profit plunge of 79% in the last 12 months to June 30. This was in the middle of a weakening residential division. However, the company had been seeking to take advantage of a turnaround in the housing market of Australia.