Investor mortgage growth keeps on rising

By Leith van Onselen

The Reserve Bank of Australia (RBA) today released its private sector credit aggregates data for the month of January:

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A chart showing the long-run breakdown in the components is provided below:

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Personal credit growth (0.0% MoM; 0.0% QoQ; 0.8% YoY) remains in the gutter, whereas business credit growth (0.8% MoM; 1.6% QoQ; 5.5% YoY) and housing credit growth (0.6% MoM; 1.8% QoQ; 7.1% YoY) are stronger, but remain below their long-run average growth rates (although housing credit is still growing more than twice as quickly as wages and off a ginormous debt base!).

The below chart shows that quarterly housing credit growth appears to have stabilised:

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A long-run breakdown of owner-occupied credit (0.50% MoM; 1.50% QoQ; 5.70% YoY) and investor credit (0.80% MoM; 2.40% QoQ; 10.10% YoY) is provided below:

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The lion’s share of mortgage growth continues to come from investors (see next chart), which continues to grow at a strong (albeit slowing) rate, leaving owner-occupied demand in its wake:

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Finally, the share of loans going to housing rose to a new all-time high of 60.81% in January 2015, whereas the share of total loans to businesses was  just 33.31% – just off record lows:

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