The number of new home loans increased modestly in October, due to a rise in finance for buying newly built dwellings.
Bureau of Statistics figures show the number of home loans approved for owner-occupiers rose 0.1 per cent to 46,477, seasonally adjusted.
That was below economist forecasts, which centred on a 3 per cent rise, according to a survey of 18 economists by Bloomberg.
The small rise in loans was exclusively driven by a 4.2 per cent increase in finance for the purchase of new dwellings, although the number of loans for home construction fell 0.3 per cent.
RBC economist Michael Turner warns that the rise in buying newly built homes may largely be a one-off reaction to policy changes in two large states.
"This likely reflects changes to first home owners grant in New South Wales and Queensland introduced during the month, which skewed incentives toward building or buying new homes," he observed.
"Unfortunately, early data for November from mortgage aggregators suggest the follow through was limited, which in turn suggests strength in October may have been a result of activity being delayed until that month." The Housing Industry Association's chief economist Harley Dale says the figures show a modest improvement since mid-2012, but are still too weak to be sure a home building recovery is underway.
"Some signs of recovery are better than none and that is what the housing finance figures are showing," he noted in a statement on the data.
The number of loans to buy established homes decreased 0.1 per cent to 38,900.
However, there was a steep jump in investor interest, with the value of loans for investment housing climbing 5.5 per cent to $7.7 billion in October.
The rise in investor lending built on an even stronger 8.8 per cent jump the previous month.
However, first home buyers are not rushing back into the market, making up 18.7 per cent of purchasers, down from a peak of 31.4 per cent in May 2009 when Federal Government stimulus boosted incentives for first time buyers and mortgage rates were around their lowest levels in recent history.