Mortgage loans demand still up

Demand for mortgage loan shows no signs of abating, with the number of loans approved in November 2017 posting a seasonally adjusted rise of 2.1% from October, data from the Australian Bureau of Statistics show.

Cooling house prices seem to have encouraged more first-home buyers. The number of loans released for first-home buyers as a percentage of total owner-occupied loans reached a high of 18%, from 17.6% in October.

Digital Finance Analytics' Martin North sees this as buyers' reaction to the incentives available and to attractor rates.

"The 'incentives' for first-time buyers are clearly having an effect – in essence, persuading people to buy in at the top, even as prices slide," said North.

He cautioned buyers to be careful, "as the increased incentives are there to try and keep the balloon in the air for longer".

The total number of loans issued to owner-occupiers climbed 2.1% across the country.

The total value of housing loans approved in November increased by 2.3% to $33.5bn, with the value of those issued to owner-occupiers rising by 2.7 to $21.3bn. Investment loans saw a lower increase of 1.5% to $12.1bn as policies meant to discourage property investing continued to hit investors.   

The average loan size for first-home buyers rose $3,300 to $327,100, while the average loan size for owner-occupied housing went up $11,000 to $388,900.

By state, the number of owner-occupied housing loans (seasonally adjusted) saw increases in New South Wales (2.0%), Queensland (3.1%), the Australian Capital Territory (8.6%), Victoria (0.5%), South Australia (1.5%), and Tasmania (0.7%). Declines were recorded in Western Australia (down 3.5%) and the Northern Territory (down 8.5%).

The number of loans for owner-occupied housing financed by banks was flat in November, after an increase of 0.2% the previous month. The seasonally adjusted series rose 2.2% in November following a decrease of 0.9% in October. 

For loans financed by non-banks, the number went up 1.4%, following a rise of 1.6% in October. The seasonally adjusted series rose 1.3%, after an increase of 3.6% the previous month.


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