(Updates with comment from economist in third paragraph.)
Sept. 14 (Bloomberg) -- Australian housing starts dropped in the second quarter, defying economists’ expectations for an increase, as more home buyers and builders remained on the sidelines.
Dwelling starts dropped 4.7 percent in the three months to June 30 from the first quarter, a government report showed today in Sydney. The forecast in a Bloomberg News survey of five economists was for a 2 percent gain.
“Building approvals and starts numbers are weakening because we had a very strong 2009, and all the buyers and builders got in then,” Ben Jarman, an economist at JPMorgan Chase & Co. in Sydney, said in a telephone interview. While housing data may improve on the view that the central bank will hold interest rates steady, “our expectation is rates will rise further, so any lift in housing market numbers will prove short- lived,” he said.
Australian home prices have dropped to the lowest level since 2009 after the Reserve Bank of Australia boosted borrowing costs seven times from October 2009 to November 2010.
Home-loan approvals in July rose less than economists forecast and the number of properties listed for sale in August jumped 23.6 percent from a year ago, as rising unemployment and subdued investment outside of the mining industry kept a lid on demand for homes.
--Editors: Andreea Papuc, Linus Chua
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