Mortgage approvals dip again in April in Oz

The rising interest rate appears to have cooled the Australian property market as reports show mortgage approvals dropped in April for the seventh consecutive month.

The central Bank of Australia has increased the standard rate of interest six times since October 2009 and it seems to have had the desired effect of cooling what was becoming a very hot property market. Governor Glen Stevens left the rate unchanged this month and several leading economists feel the rate has been increased too quickly and should now settle at the current rate of 4.5 per cent for the next few months.

Mortgage approvals for first time buyers have dropped quite sharply since the home buyers grants have been cut.

Australian property prices climbed by around 20 per cent in the twelve months ending in March but the feeling among many in the Australian real estate business is that prices may soon start to drop if home loans are proving too difficult to attain.