By a staff reporter
The demand for home loans fell against expectations for the fourth consecutive month in January, according to the Australian Bureau of Statistics.
ABS data showed the number of home loans granted in January dropped a seasonally adjusted 1.5 per cent to 44,383.
The result compares to a downwardly revised 45, 075 in December.
Economists had expected the number of housing finance commitments to lift by 0.2 per cent.
Total housing finance by value rose 2.4 per cent in December, seasonally adjusted, to $21.485 billion.
Economist says data improves chance of rate cut
The chances of more interest rate cuts have improved after the fall in home loan approvals, a leading economist says.
JP Morgan economist Tom Kennedy says it was the fourth consecutive month that approvals fell and was a sign the Reserve Bank of Australia needed to cut the cash rate further.
"That could suggest that consumers are still pretty apprehensive in acquiring new debt even though the RBA has delivered significant easing over the past 18 months," he said.
"I definitely think it supports the bias for the RBA to maintain a dovish tone and for rates to go lower."
The RBA cut the cash rate 1.75 percentage points between November 2011 and December 2012, bringing it to its current level of three per cent.