Home loan demand rose in
\nOctober, according to new data
\nfrom the Australian Bureau of
\nStatistics (ABS) following two
\nmonths of decline.<\/p>\n
The latest Housing Finance data from the ABS reveals that, in seasonally adjusted terms, 52,654, home loans were approved throughout October \u2013 an\u00a0increase of 2.2 percent on the month before.<\/p>\n
The data reveals that $30 billion worth of dwelling commitments were made over October, an increase of 2.6 percent on the month prior, in seasonally adjusted terms.<\/p>\n
This included an increase of 3.5 per cent in the value of owner-occupied housing commitments to $20.1 billion and a 0.6 percent increase in the value of investment loans to $9.8 billion.<\/p>\n
Mortgage Choice chief executive officer Susan Mitchell said that October saw a welcome lift in the number and value of home loans approved.<\/p>\n
\u201cThe previous month\u2019s data revealed the weakest value of dwelling commitments in four years.<\/p>\n
\u201cWhile October\u2019s unexpected results could signal a reversal in the recent softening in approvals, it is important to consider the volatility in monthly data comparisons,\u201d Ms Mitchell said.<\/p>\n
\u201cThat being said, the ABS\u2019 data revealed the first increase in the value of investment loans since February this year.<\/p>\n
\u201cThe encouraging result may suggest that APRA\u2019s lifting of the benchmark on investment lending is starting to have an effect on demand for investment loans.<\/p>\n
\u201cThe recent decline in housing finance approvals may be attributed to the meticulous level of scrutiny lenders are applying to new home loan applications, which has increased the length of time it is taking for home loans to progress from application through to approval.<\/p>\n
\u201cWhile October\u2019s data is encouraging, it remains to be seen whether demand for home loans will start to stabilise in the near-term.<\/p>\n
Looking ahead, a sustained decline in house prices should continue to support home loan demand into the New Year.<\/p>\n
\u201cIn fact, the most recent Hedonic Home Value Index from CoreLogic revealed an annual fall of more than four percent, led by annual falls of more than eight percent and more than five percent in Sydney and Melbourne respectively.<\/p>\n
\u201cTighter credit policies and increased scrutiny of home loan applicants\u2019\u00a0financial situation is likely to continue over the medium term, which is why I urge anyone looking to secure a home loan to seek professional advice.<\/p>\n
\u201cA qualified mortgage broker will be able to guide first time buyers through the complex home loan process, as they are in touch with the changing lending landscape and the policies and preferences of Australia\u2019s lenders.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
Home loan demand rose in October, according to new data from the Australian Bureau of Statistics (ABS) following two months of decline. The latest Housing Finance data from the ABS reveals that, in seasonally adjusted terms, 52,654, home loans were approved throughout October \u2013 an\u00a0increase of 2.2 percent on the month before. The data reveals […]<\/p>\n