Westpac has released its monthly housing market report which sees investors driving the property market forward in 2022:
Generally speaking, where investors go, housing markets usually follow. The recent revival – led by owner occupiers – is a rare counter-example with owner-occupiers leading the way. However, as already noted, affordability pressures are starting to weigh on owner occupier demand. Meanwhile, investor activity is now clearly lifting, albeit off a low base. Chart 14 shows investor finance approvals have been rising strongly since the turn of the year. They now account for over 30% of new housing loans by value, compared to just 23% late last year. That is still well below the 40% peak share seen during the previous price cycle in 2016-18.
The question is whether the current resurgence will carry to those previous peaks.
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Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.
