Home loan demand hit a six-year high in August, despite talks of a property market cool down.
According to the latest housing finance data from the Australian Bureau of Statistics, 55,677 home loans were approved over the course of the month – up 2.9% on the previous month and the highest it has been since September 2009.
Mortgage Choice chief executive officer John Flavell
says this is surprising in the current market, but proves the property market remains alive and well.
“To see a similar level of home loan demand in today’s market, when there is not only no boosted first home buyer incentives in place, but lenders are effectively trying to reduce their level of investment lending activity, is surprising and just goes to prove the strength of the housing market,” he said.
In addition to seeing a spike in the number of home loans written over the course of the month, the cost of the average home loan was also up. The average home loan across Australia stood at $371,200 in August, up 15.4% on a year ago – the fastest pace of growth in 12 years.
According to the latest figures released by CoreLogic RP Data, home values in across Australia’s capital cities increased by 0.9% in September, bring the year-on-year capital growth to 11%.
Flavell says it is “fair to assume” the average home loan size will continue to grow so long as property prices continue to climb. He also expects home loan demand to remain strong over the coming months, as many lenders are currently offering some significant incentives to owner occupiers in a bid to win their business.