Owner-occupier and investment lending rose in February, but weakness in business finance pulled total lending commitments lower.
The value of new lending commitments to households rose 2.6 per cent to $32.13 billion in February, according to seasonally adjusted figures released on Tuesday by the Australian Bureau of Statistics, fuelled by a 3.4 per cent monthly rise in the value of lending to owner-occupiers.
ANZ said it was the first monthly rise for housing finance since July last year.
But lending to businesses fell 11.1 per cent in the month to $30.59 billion, dragging total business and household lending down by 4.6 per cent to $62.72 billion.
The Aussie dollar spiked to 71.30 US cents on the release of the data before cooling to 71.22 at 1155 AEST.
Despite the February rise, the value of total household lending remains 15.7 per cent lower than the same time last year.
“The longer term story is largely unchanged with new lending to households remaining subdued and well down on levels seen over the past five years,” ABS chief economist Bruce Hockman said.
Westpac senior economist Matthew Hassan said the update was firmer than expected with some of the effects of tightening credit conditions dissipating somewhat.
“That said, the signs of improvement are still only tentative,” Mr Hassan said.
“The market may be starting to find a base in terms of finance activity but conditions remain weak overall.”
The number of loans to owner-occupier first-home buyers rose 1.8 per cent for the month, slightly outpacing the rise in the number of loans to owner-occupier non-first home buyers (up 1.6 per cent).
The total value of loans to owner-occupiers remains 13.9 per cent lower than the same point last year.
Lending for investment dwellings lifted 0.9 per cent for the month to $4.74 billion, but was still 29.1 per cent lower than a year ago.
Meanwhile, financing for owner-occupiers buying newly constructed dwellings dipped another 2.4 per cent to $2.13 billion, now 31.2 per cent lower than a year ago.