Mortgage demand drops

Home finance plummets to lowest since GFC

THE value of new mortgages slipped another 2.1 per cent in January, marking Australia’s largest annual decline since the depths of the global financial crisis.

The value of dwelling commitments, excluding refinancing, slipped to $17.12 billion in January, according to seasonally adjusted figures released yesterday by the Australian Bureau of Statistics.

That made for a 12-month decline of 20.6 per cent, with the total number of owneroccupier mortgage commitments falling 2.6 per cent over the month and 13.6 per cent over the year to come in at 47,407.

“Weaker lending for dwellings again drove much of the overall fall in lending to households, with further falls in lending for investment dwellings and for owner-occupier dwellings in January,” ABS chief economist Bruce Hockman said.

“Reflecting the impact of both supply and demand side factors, new lending for dwellings is down over 20 per cent from January 2018, the largest through the year decline since late 2008.”

The biggest monthly fall in the number of owner-occupier commitments was the 9.5 per cent drop for newly built homes.

In dollar terms, owner-occupier dwellings excluding refinancing fell 1.3 per cent to $12.45 billion, taking the annual decline to 17.1 per cent.

Loans to new investors declined by 4.1 per cent in January – and 28.6 per cent over the 12-month period – to $4.67 billion.

Total household lending, which includes personal loans, fell 2.4 per cent in the month to $31.29 billion, 17.5 per cent lower than a year earlier.

Lending to businesses jumped 10.8 per cent to $34.74 billion.