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Thread: Home-loan approvals in Australia up for 3rd month

  1. #1
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    Default Home-loan approvals in Australia up for 3rd month

    Published April 12, 2007

    Home-loan approvals in Australia up for 3rd month


    (SYDNEY) Australia's home-loan approvals climbed for a third straight month in February as rising wages buoyed confidence among property buyers, signalling a nascent housing recovery that may boost economic growth.

    The number of loans to owner-occupiers to build or buy homes or apartments rose 0.3 per cent to 62,369 from January, the Bureau of Statistics said yesterday, matching the median estimate of 20 economists in a Bloomberg News survey.

    A housing pickup may bolster expectations among futures and currency traders that the Reserve Bank of Australia is poised to raise interest rates as soon as next month. The economy's 16-year expansion may gather pace as home-buyers shrug off last year's three rate increases and investors return to the property market to take advantage of rising rents.

    'Households appear to have adjusted very well to three rate hikes, so the cash rate clearly isn't that restrictive,' said Ong Su-Lin, senior economist at RBC Capital Markets in Sydney. 'It supports the Reserve Bank's tightening bias. All the data in early 2007 has shown a real step up in the economy.'

    The Australian dollar rose close to a 17-year high after the report. The currency bought 82.46 US cents at 4.32pm from 82.38 cents immediately before the figures were released.

    The yield on the 10-year bond fell one basis point, or 0.01 percentage point, to 5.89 per cent.

    Total lending climbed 3.3 per cent to A$20.9 billion (S$26.1 billion) in February, yesterday's report showed. The number of loans approved in January gained a revised 0.5 per cent. The value of lending to owner-occupiers rose 0.9 per cent to A$14.3 billion in February. The value of lending to investors who plan to rent or resell homes surged 8.9 per cent to A$6.6 billion.

    Australia's A$934 billion economy added more than 300,000 jobs last year, the biggest annual employment gain since 1989, and the jobless rate is close to a 31-year low.

    Wages rose 1.1 per cent in the fourth quarter from the previous three months, according to a government index, the fastest pace of growth in the index's nine-year history.

    That buoyed home-buyers even after the Reserve Bank's three interest-rate hikes last year, which took the overnight cash rate target to a six-year high of 6.25 per cent. - Bloomberg

  2. #2
    Steve Mayne
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    Default Singapore Owns More Of Australia Than Australia

    Stephen Mayne
    2 May 2007

    Peter Costello was busy showing Lee Kuan Yew around Parliament a few weeks back when the Singapore strongman was in town to pick up an honorary doctorate from ANU. The citation, perhaps, should have read: "For building the first sovereign state to own more Australian business assets than the Australian Government itself."

    Since coming to office, Peter Costello and John Howard have flogged off almost everything that wasn't bolted down, including the Defence Department headquarters at Russell Hill, something you can't imagine the Americans doing with the Pentagon.


    Here’s a list of the residual operating assets held by the Australian Government:

    - 17% stake in Telstra: $9.6 billion
    - Australia Post: $5 billion
    - Medibank Private: $1 billion
    - Australian Submarine Corp: $200 million
    - Total: $15.8 billion

    Sure, there's $40 billion in cash sitting in the Future Fund, but this money ultimately belongs to the public servants who are owed the $100 billion in unfunded superannuation liabilities. The Future Fund is nothing like the Singapore Government's almighty Temasek Holdings, which has a controlling stake in the various companies that now control more than $22 billion worth of Australian assets.


    This is because most of the Australian investments have been done through Singapore Telecommunications and Singapore Power, rather than Temasek itself.

    Here's a list of Australian commercial assets controlled by the Singapore Government:

    - Optus: $10 billion
    - Alinta energy assets: $4.3 billion
    - Victorian electricity transmission monopoly: $2 billion
    - Old Texas Utilities Australian portfolio: $5.5 billion
    - Property: $2 billion
    - Australand stake: $1 billion
    - Total: $22.8 billion

    The Singaporeans prefer to play down the scale of their Australian assets, but this little country of 4 million people has left us for dead when it comes to national savings and global investments. It will be interesting to hear what Peter Costello and John Howard say when the question is put to them about the Government’s residual commercial assets being less than those held by Singapore.

    Maybe Peter Costello should have offered Medibank Private directly to Lee Kuan Yew when he dropped by.

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