Home loan demand has soared 1.6% over the last month, new data has revealed.
According to the latest data from the Australian Bureau of Statistics, 54,449 home loans were written throughout the month of September – up from the 53,570 loans written the month prior.
Speaking about the results, Mortgage Choice chief executive officer John Flavell said he had expected to see a lift in home loan demand.
“Spring is a notoriously hot season for the property market, so I wasn't surprised to see an overall uplift in home loan demand in September,” he said.
“Furthermore, many of Australia's lenders reduced their interest rates towards the end of August following the cash rate cut by the Reserve Bank. These rate cuts would have no doubt encouraged more people into the property market, resulting in a jump in home loan demand.”
But it wasn't just the number of home loans written that surged higher in September, with the value of home loans written also increasing.
“In total, more than $32 billion of home loans were approved throughout September – up 2.3% on the month before,” Mr Flavell said.
“This substantial growth can largely be attributed to the strong uptick in demand for investment loans.
“Over the course of the month, more than $12.4 billion in investment loans were approved – up 4.6% from August.”
Moving forward, Mr Flavell said he wouldn't be surprised to see home loan demand continue to increase slightly over the coming months.
“Data from Core Logic shows property prices across the combined capital cities rose a further 0.5% in October – proving that the property market remains alive and well,” he said.
“Furthermore, interest rates continue to sit at all-time lows, which is not only helping to keep the cost of borrowing low, but it is helping to keep property demand high.
“Anyone looking to get their foot onto the property ladder in the not-too-distant future, would be well placed to review their options now, while rates continue to sit at historical lows.”