Australian Finance Group (AFG) yesterday released its housing finance data for the month of March, which registered the Group’s strongest March mortgage sales on record, with 7,893 finance commitments (valued at $3,181 million) over the month, an improvement of 8.6% on March 2012 and 0.9% above the previous best March in 2009 (see next chart).
AFG also recorded continued weakness in first home buyer (FHB) demand in New South Wales and Queensland, following the removal of the FHB grant on pre-existing dwellings in October 2012:
AFG Mortgage Index shows the continuing weakness of first home buying activity in NSW, where only 4% of new borrowers are first home buyers, and QLD – 5.1%. These figures compare with 15.3% for SA, 18.3% for VIC and 22.9% in WA.
As noted last month, I would advise readers to exercise caution interpreting AFG’s figures. The Group’s market share fluctuates month-to-month and has also been rising in recent years. Therefore, its results do not necessarily translate to the overall mortgage market as captured later by the Australian Bureau of Statistics (ABS).
To illustrate, consider the below chart showing AFG’s market share, which has trended upwards since early-2011 (see next chart).
In a similar vein, the growth of AFG mortgage commitments has diverged significantly from the ABS since November 2009 (see below chart).
Finally, AFG recorded all-time high mortgage sales for the month of January, whereas the total value of non-seasonally adjusted mortgages captured by the ABS was around -8% lower than January 2008.
