Australian mortgage growth ramps up

The Reserve Bank of Australia (RBA) has released its private sector credit aggregates data for the month of April.

Quarterly mortgage credit growth continued to firm, rising for the 9th consecutive month to 1.5% – the highest rate of growth since September 2017:

Quarterly mortgage growth

Quarterly mortgage growth ramping up.

Owner-occupiers continue to drive mortgage growth, rising by 1.8% over the quarter versus only 0.8% growth for investors. However, investor mortgage growth is clearly picking up steam:

RBA quarterly mortgage growth

Investor mortgage growth picking up steam.

Meanwhile, annual mortgage growth continues to rise from record low levels. It rose to 4.4% in the year to April 2021 – the highest level since January 2019:

Annual mortgage growth

Annual mortgage growth continues to rebound from record lows.

Again, this growth is being driven by owner-occupiers, whose annual mortgage growth was 6.1% in the year to April 2021, versus only 0.55% growth in investor mortgages:

Annual mortgage growth

Owner-occupied mortgage growth strong, investor mortgage growth still weak.

The acceleration in mortgage growth is obviously far slower than the acceleration in new mortgage commitments. This is because existing mortgage holders are taking advantage of record low interest rates to repay debt, which is mostly offsetting new mortgage demand.

Unconventional Economist

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