Australian mortgage market shows signs of life

Today’s housing finance data for June from the Australian Bureau of Statistics (ABS) recorded a modest rebound in mortgage commitments:

As shown above, total finance commitments (excluding refinancings) rose by 1.9% in June, with owner-occupied commitments rising 2.4% and investor commitments rising 0.5%.

However, 0ver the year, total finance commitments (excluding refinancings) crashed by 17.6%, with investor commitments tanking by 24.7% and owner-occupied falling by 14.8%.

First home buyer (FHB) commitments also rose by 2.1% in number terms and by 2.4% in value terms in June. However, over the year, FHB commitments were down by 4.6% (number) and by 4.4% (value):

FHB’s share of Australian mortgages (excluding refinancings) rose to 29% by number and 25% by value:

However, new home finance (construction and new combined) fell by 2.8% over June and by 17.7% year-on-year, signalling further headwinds for dwelling construction:

Finally, the below chart tracks the annual growth in the value of finance commitments (-18%) in trend terms, and shows both owner-occupied finance (-15%) and investor finance growth (-26%) have crashed; albeit both are showing an improving trend:

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