Mortgage sales slump 20% in December
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11/01/2010 9:00:00 AM
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The monthly AFG Mortgage Index recorded a 20% fall in mortgage sales in December 2009, compared to the previous month.
Just $1.9bn worth of mortgages were arranged by AFG brokers in December compared to $2.9bn in September 2009.
Mark Hewitt, GM sales & operations of AFG said: 'We have been warning for months that three rate rises in a row was overkill for a vulnerable market, and the latest figures confirm our fears.
"Yes, December is traditionally a slower month than November, but what we saw last month was a 20% fall compared to an 8% fall in 2008.
"When you combine the effects of increasing, out of cycle lending rates and tighter credit criteria with an end to the first home boost, what you get is a combination of factors that constrains confidence.
"Property investors, able to take a long term view, are hoping to ride a new upward cycle in property values, but right now ordinary families are sitting on their hands rather than upgrading.'
On a more positive note, two out of every five mortgages arranged in NSW in December were for investment properties according to AFG
The Index showed that increasing interest in NSW property saw the state end the year with $180m invested in properties in December 2009 - compared to $153m in December 2008 - a 17% increase.
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