Last week’s mortgage finance data from the Australian Bureau of Statistics (ABS) was unequivocally strong, driven by owner-occupiers:
Total new mortgage commitments (excluding refinancings) rose by 23.3% year-on-year in October, driven by a whopping 31.2% growth in owner-occupier mortgage commitments versus 2.8% growth in investor commitments.
Mortgage growth is one of the very best indicators for property price growth given its very strong historical correlation.
Below are charts plotting the annual value of mortgage growth (excluding refinancings) against annual dwelling value growth.
First Sydney:
Next Melbourne:
Next Brisbane:
Next Perth:
Next Adelaide:
And finally the 5-city aggregate:
As shown above, the mortgage rebounds have been strongest across the smaller three capitals, which is also reflected in their recent price rebounds:
Perth and Brisbane are looking especially strong.
By comparison, Sydney’s has experienced a moderate mortgage rebound, pointing to a softer rebound, whereas Melbourne remains soft.
