By a staff reporter, with AAP
The demand for home loans rose more than expected in June, according to the Australian Bureau of Statistics.
The data showed the number of home loans granted in May lifted a seasonally adjusted 2.7 per cent to 51,001.
The result compares to an initially reported 49,636 in May.
Bloomberg had expected the number of housing finance commitments to rise by two per cent in May.
Total housing finance by value rose 1.2 per cent in June, seasonally adjusted, to $23.69 billion.
JP Morgan economist Tom Kennedy said the stronger than expected housing finance figures were a sign the property market was responding to low interest rates.
"This is actually the sixth consecutive monthly increase we've seen. We haven't had a negative print yet for 2013," Mr Kennedy said.
"It's obviously a positive sign that does suggest there is a little bit of activity perhaps picking up in the residential housing market.
But CommSec chief economist Craig James said the value of new loans was still more than 4.0 per cent lower than it was five years ago.
"Apparently Australian borrowers haven't had it this good for over 50 years but you wouldn't know it from looking at the home loan data," Mr James said.
Borrowers remain cautious, particularly first home buyers, he said.
"Once the election is out of the road, we would expect more people to seriously contemplate buying homes to either live in or as a form of investment."
"Housing is well placed to provide a boost to the economy and take over growth leadership from mining."