Australian housing finance grew in June, albeit at a slower pace than expected, as low interest rates and government stimulus continued to support the sector.
The number of housing-finance approvals in Australia rose a seasonally adjusted 1.1% in June from May, the Australian Bureau of Statistics said. Economists surveyed ahead of the announcement on average had expected a rise of 2.0%.
Finance for construction of new homes rose 2.8% in June, while finance for the purchase of new dwellings fell 0.2%, the ABS said.
Economists said housing finance remains at strong levels historically, but fears are growing that the sector could weaken over the medium term if interest rates rise and as government grants for first home owners are scaled back.
First home owners accounted for 27.1% of housing finance in June, down slightly from 28.5% in May, the ABS said.