Data Snapshot: Housing Finance - Investors Lead the Decline

• Home lending resumed its decline in June, with the number of loans to owner occupiers falling 1.1% in June, retracing May’s increase. The number of new home loans has declined in six out of the past seven months.

 

• Annual rates were negative across most States and Territories in June, including Victoria, NSW, Queensland, South Australia, the ACT, the Northern Territory and Western Australia. The exception was Tasmania, where the number of home loans increased over the past year.

 

• The weakness in home lending continued to be most pronounced among investors. The value of investor lending fell 2.7% in June, which was the fourth consecutive monthly decline. On an annual basis, investor housing was down 18.1% from a year ago, while the value of owner occupier loans increased 0.2% over the same period.

 

• Regulatory measures and tighter lending standards have impacted investor lending more noticeably, relative to owner occupier and first home buyers.

 

• Conditions in the housing market continue to soften, as reflected in declining housing lending, falling auction clearance rates, pre-sales activity and a slowdown in dwelling prices. Softness in the housing market is expected to continue, with further modest price declines likely.  Strong population growth and a firm labour market are providing some support to the housing market, although it won’t be enough to halt the downturn in housing. 

 

Please see the attached report for more information.

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