Login
iscover
The latest economic data has shown an “encouraging” lending recovery across the month of August driven by owner-occupiers and investors alike, but it doesn’t yet account for Victoria’s second-wave woes.
Following the release of the latest lending statistics from the Australian Bureau of Statistics, the Real Estate Institute of Australia (REIA) has lauded the “largest ever monthly increase” in new loan commitments.
It means that for the third consecutive month, the value of new loan commitments has grown.
REIA president Adrian Kelly highlighted that “the seasonally adjusted value of new loan commitments for owner-occupier housing rose 12.6 per cent in August and 19.3 per cent for the year, with the rise seen in all states and territories, except the Northern Territory”.
He flagged that the largest increases in the value of new loan commitments were seen in Victoria, Queensland and New South Wales.
But the president has also warned agents to treat the recovery with caution, saying: “While this is the largest monthly increase in the history of the series, some caution in the interpretation in the month-to-month comparisons is required.”
As also pointed out by the ABS, Mr Kelly said some of the commitments in August reflect consumer demand in earlier months, with lenders reporting that current processing times mean that August finance commitments reflect customer demand in June and early July, prior to Victoria imposing stage 3 and stage 4 restrictions.
“The recovery in lending is encouraging and reflects the earlier easing in restrictions on movements and subsequent market response but does not yet reflect the impact of second-wave restrictions in Australia’s second-largest market of Melbourne,” he conceded.
Victoria, alongside Queensland, drove a 9.3 per cent increase in the value of loan commitments for investor housing, which is still down by 4.6 per cent for the year.
Mr Kelly also highlighted that the number of owner-occupier first home buyer loan commitments increased by 17.7 per cent for the month.
It’s “the third consecutive monthly increase and is the highest level since October 2009”.
The president noted “all states and territories, apart from the Northern Territory, displayed rises in owner-occupier first home buyers in August”.
ABOUT THE AUTHOR
Grace Ormsby
Grace is a journalist across Momentum property and investment brands. Grace joined Momentum Media in 2018, bringing with her a Bachelor of Laws and a Bachelor of Communication (Journalism) from the University of Newcastle. She’s passionate about delivering easy to digest information and content relevant to her key audiences and stakeholders.
You are not authorised to post comments.
Comments will undergo moderation before they get published.