January 17, 2018
According to the latest Housing Finance Data from the Australian Bureau of Statistics, 56,876 home loans were approved throughout November, marking the fifth consecutive month that more than 55,000 home loans were approved.
“The last time we saw this kind of prolonged period of strong home loan demand was back in February 2016,” Mortgage Choice chief executive officer John Flavell said.
“Today’s data would suggest the property market is robust, driven in large part by record low interest rates.
“History shows us that the market tends to pick up towards the end of the year as people assess their home loan needs and financial position in the lead up to Christmas. With that said, I anticipate we will see continued levels of strong home loan demand next month as well.”
Throughout the month of November, $33.5 billion in home loans were approved – up 2.3% on October. This included an increase in the value of both owner occupied and investment loans written.
“Just over $21 billion worth of owner occupied loans were written in November - up 2.7% on the month prior. Similarly, the value of all investment loans written jumped 1.5% to just over $12 billion,” Mr Flavell said.
“The growth we have seen in home loan demand can largely be attributed to the historically low rate environment.
“At its last meeting for 2017, the Reserve Bank of Australia made the decision to keep the official cash rate on hold at 1.50%. This decision has helped to keep the cash rate low and borrowing at affordable levels.
“Looking ahead, expectations are that interest rates will remain lower for longer. As such, I believe we may see continued strong home loan demand.