Today’s housing finance data for March, released by the Australian Bureau of Statistics (ABS), posted a seasonally adjusted fall in overall housing finance commitments, with the trend in mortgage growth continues also weak.
According to the ABS, the total number of owner-occupier finance commitments (excluding refinancings) fell by a seasonally adjusted 1.6% over the month to be up by just 2.5% over the year (see below charts).
By c0ntrast, the value of investor finance commitments rose by 1.5% in May but was down by 13.0% over the year (see next chart).
The annual share of total loans going to investors (excluding refinancings) also fell to 47.8% in March from a peak of 51.6% in July:
First home buyer (FHB) owner-occupied demand rose in March (due mostly to seasonality), up by 4.1% over the month but were down by 7.5% over the year, and represented just 14.2% of total owner-occupied finance commitments (see below charts).
Meanwhile, the average loan size rose by 0.2% in March and was up 5.9% over the year, although the trend has fallen sharply on a 3-month moving average basis:
Finally, the below chart shows that the trend pick-up in the value of owner-occupied housing demand is only partly offsetting the sharp fall in investor demand:
Overall trend housing finance growth continues to slow sharply which, other things equal, should mean that house price growth nationally should also weaken.
However, as pointed out this morning, transaction volumes have fallen even more sharply, which explains the latest rise in the RP Data daily index.
