During the past crisis one of the stimulus measures adopted by the government was to provide assistance to first home buyers. This assistance ended in December so we saw a rush of home lending leading into the end of 2009. Figures released yesterday showed that home lending subsided dramatically as a result of purchasing plans being brought forward. One of the key things the RBA has been looking for has been the resilience of the economy in the absence of stimulus measures such as this. I wouldn't read too much into these figures just yet and in a speech yesterday the RBA's Phillip Lowe warned that there is still a risk of climbing house prices as a result of supply constraints.
Figures: Home loans dropped 7.9% in Jan. The biggest fall since June 2000.
