The number of Australian home-loan approvals fell a seasonally adjusted 0.5% in March from February, the Bureau of Statistics said Monday.
Economists surveyed ahead of the announcement had expected no change for the month.
The value of loans for investment housing rose 0.8% from February, the ABS said.
The pace of lending for property is under close scrutiny in Australia amid concerns that record household debt could eventually slow economic growth, or at worst, destabilize the nation's banks.
Reserve Bank of Australia Governor Philip Lowe recently indicated that the central bank remains reluctant to lower interest rates further to avoid stoking the overheated market.
But equally, a soft job market means immediate interest rate increases are unlikely.
Interest rates have been held at a record low of 1.5% since August, with markets betting the RBA will remain sidelined until next year.
In late March, Australia's banking watchdog ordered banks to toughen lending practices to investors in residential property, as it worries about risks including rising household indebtedness.
The Australian Prudential Regulation Authority told banks to limit the flow of interest-only lending to 30% of new residential mortgage loans. Banks must also keep lending to investors well below a benchmark of 10% growth, APRA said.
The success or failure of APRA's push will go a long way to shaping the outlook for interest rates, economists said.
Finance approvals to build new houses rose by 1.8% in March from February. Approvals to buy newly built dwellings rose by 9.6%, while lending for the purchase of established homes fell by 1.3% in the month.
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(END) Dow Jones Newswires
May 14, 2017 21:46 ET (01:46 GMT)