Home loan demand drops for third month

HOME loan demand has dropped for the third consecutive month, according to new data from the Australian Bureau of Statistics.

The latest Housing Finance data showed 53,062 home loans were approved throughout the month of April, down 1.9 per cent from 54,088 the previous month.

“April marked the third consecutive month that we saw a drop in the number of home loan approvals, and it is actually the lowest since May 2015 when 50,049 home loans were approved,” Mortgage Choice Toowoomba broker Julian Collins said.

“This slight drop in home loan demand isn’t all that surprising when you consider that Australia’s lenders have been seriously tweaking their pricing and policy in recent months. This added level of complexity in the home loan market has subsequently caused demand to slide slightly.”

According to the data, the value of all dwelling commitments fell 1.6% to $32.5 billion over the month of April.

“The value of owner-occupied housing fell 1.1% to $19.9 billion, while the value of investment loans written fell 2.3% to $12.6 billion,” Mr Collins said.

Mr Collins said he expected home loan demand to remain relatively strong, despite added complexity in the mortgage market.

“Interest rates remain at historical lows, which keeps the cost of borrowing at affordable levels and this will keep demand relatively strong,” he said.