The Victorian Department of Sustainability & Environment (DSE) released transfer and mortgage data for the month of August, which shows continued weakness in the number of housing transfers and finance commitments.
First, below is a chart showing the rolling annual number of housing transfers from February 2003 to May 2012:
According to the DSE, the annual number of Victorian home transfers fell slightly over the month – from 171,495 in July 2012 to 170,862 in August – which is the lowest level reached in the series’ history and 13% below average levels.
The DSE’s mortgage finance statistics are unique in that they provide data on both mortgage lodgements (i.e. new mortgages) and mortgage discharges (i.e. mortgages repaid in-full). Below is a chart showing both series on a rolling 12-month basis:
And below is the number of net new mortgages created, calculated by subtracting mortgage discharges from mortgage lodgements:
According to the DSE, the annual number of mortgages discharged (193,138) has again exceeded the number of mortgage lodgements (191,278), meaning that -1,860 mortgages were lost in the State of Victoria in the 12-months to August. This compares to the average of around 13,291 annual net mortgage creations since the series began in 2002. It was the sixth straight month that annual mortgage discharges have exceeded mortgage lodgements.
And below is a similar chart showing that the ratio of mortgages lodged to mortgages discharged:
Between 2003 and 2005, there were around 11 mortgages created for every 10 mortgages discharged. In the 12-months to August 2012, however, the number of mortgages lodged has slipped just below the number of mortgages discharged, signalling that Victorians are deleveraging.
Twitter: Leith van Onselen. He is the Chief Economist of Macro Investor, Australia’s independent investment newsletter covering trades, stocks, property and yield. Click for a free 21 day trial.
