HIA: Rental investments will need to be supported by gov't measures

Investments in new rental stock will need to be supported with a range of different criteria, according to the chief economist of the Housing Industry Association.

Speaking earlier this week, Dr Harley Dale asserted that a blend of short-term stimulus from the government, long-term policy reform and interest rate cuts will be needed in order to see "a sustained recovery" in new housing and rental investments.

Dr Dale made his remarks following the publication of housing finance figures for the month of November last year.

The established lending market, he explained, has now witnessed five rises in the past six months, but lending for new homes "has yet to join the ride".

He stated: "Over the three months to November 2011, the total number of first home buyer loans was 19 per cent higher when compared to the same period in 2010, while loans for trade-up buyers rose by 2.4 per cent."

If you are considering a Melbourne property investment, November figures published last month by the Real Estate Institute of Victoria indicate that in the 12 months to November 30 2011, the median price of a unit or apartment in metropolitan areas of the state held steady at $460,000.

Posted by Sara Pritchard