“Mini boom” in the Australian housing market;

[Sydney, 10th Reuters]-The August mortgage announced by the Australian Bureau of Statistics rose 3.2% to A $ 33.5 billion ($ 22.6 billion).

Loans to real estate investors increased by 6%, marking a significant increase since September 2016. This highlights the booming housing market as a result of cuts in interest rates at the central bank and relaxation of loan regulations.

The approved amount of mortgage is a leading indicator of housing prices. This statistic is expected to support housing prices and improve consumer sentiment.

UBS economist George Tharenou said, “It confirms our view that a mini-boom is happening. Loans are expected to increase 20% year on year and prices will increase 10% year on year.”

“If loans and prices continue to rise more than expected, there is a higher risk that the central bank will stop monetary easing next year,” he said. He expects an additional rate cut by mid-next year.

The central bank cut interest rates last week following June and July. In response to aggressive monetary easing, housing prices have risen on a monthly basis since the middle of this year.

However, prices have continued to decline on a year-on-year basis, and economic activities other than the housing market are still sluggish.

August personal loans fell 2.2%. In July, it decreased by 3.8%. Corporate loans also fell 2.1%, down more than 6% year-on-year.

As for house prices, there are many skepticism about the significant increase in the future.