New figures show lending to households has fallen, affecting the number of people investing in the housing market.

According to the Australian Bureau of Statistics, the amount of loans issued for the construction of a new home is down 19.4 per cent.

Chief Economist Housing Industry Association Tim Reardon tells Ross Greenwood there is a lack of confidence in the housing market.

“The market has contracted extremely quickly over the past six months.

“Partly due to lack of confidence due to house prices… but also due to the credit squeeze.”

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