The Courier-Mail

Lend­ing ac­cel­er­ates but slows for homes


FI­NAN­CIAL in­sti­tu­tions are is­su­ing credit at their fastest pace for six months but credit to hous­ing in­vestors is grow­ing at its slow­est rate for two years.

Fig­ures from the Re­serve Bank of Aus­tralia showed that to­tal credit rose by 0.6 per cent be­tween June and July, the big­gest monthly rise since Jan­uary. But the 0.6 per cent rise in credit to hous­ing in­vestors, a par­tic­u­lar fo­cus for the RBA, was the small­est monthly gain since mid-2013, fol­low­ing June’s 1 per cent rise, which was the steep­est since June 2007.

W ith fears grow­ing a hous­ing mar­ket bub­ble could threaten eco­nomic growth, the Aus­tralian Pru­den­tial Reg­u­la­tion Au­thor­ity in De­cem­ber warned lenders not to ex­pand their credit to the sec­tor by more than 10 per cent an­nu­ally.

More re­cently, APRA has flagged an in­crease in the amount of cap­i­tal banks have to hold for their residentia­l prop­erty lend­ing.

De­spite the slower rise in July, an­nual growth in this com­po­nent of credit stayed above APRA’s red line, at 10.8 per cent over the year to July, al­beit down from 11.1 per cent.

Mean­while, HIA fig­ures showed new home sales eased 0.4 per cent in July, af­ter ris­ing 0.5 per cent in June.

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