The home loan market continued its downtrend in March 2018, marking the sixth straight month of housing financing decline. The decline was seen across all the states and territories except Tasmania, where lending jumped by 7.2%.
Real Estate Institute of Australia president Malcolm Gunning said owner-occupied finance commitments fell by 0.7% and 0.9%, refinancing excluded.
The value of investment housing commitments posted a decline as well, falling by 0.9% in March, while the largest home financing cut was in Northern Territory at 1.3%. Gunning mentioned that the purchase of dwellings for rent or resale has been at its lowest level since May 2016.
“In trend terms, the number of established dwellings purchase commitments decreased by 0.7% while the purchase of new dwellings decreased by 0.8% and new dwelling construction fell by 1.2%," he noted.
The only hope for the market, it seems, is active participation from first home buyers, who comprised 17.4% of the owner-occupied housing finance commitments in March – the number of home loans to these first-timers jumped 5.8% from February.
"APRA may have constrained bank lending too long and created a credit squeeze. They did not consider the lag effect in the market of their decision. The only bright spot in the market is first home buyers," Gunning said.
Collections: Mortgage News
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