Home loan growth peaks in four years

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Reserve Bank data released on Tuesday shows 12-month housing growth to October 2021 reached 6.7% – the highest rate since July 2017.

Year-over-year homeowner mortgage credit growth was 9.0%, the highest growth rate since August 2016.

This despite data on ABS loans indicating that homeowner loans are gradually declining.

Growth in investor credit at the end of the twelve months rose 0.2 percentage point to 2.6%, the highest since February 2018.

There are currently mixed signals in the market, with APRA announcing a tightening of serviceability in October and effective in November, with a hike in fixed mortgage rates.

The Reserve Bank’s cash rate is also expected to rise ahead of its initial forecast for 2024, and the CBA has forecast house prices to fall by up to 10% in 2023.

As a result, last week, SQM Research estimated that the rise in house prices would moderate in mid-2022, due to falls in Sydney and Melbourne.

However, Propertyology research chief Simon Pressley said household financial foundations were still strong.

“Ultimately, however, much of the growth in credit over the past two years is a release from pent-up demand created by APRA which has cut credit from beejezus over the past four years,” he said. Mr Pressley told Savings.com.au Tuesday.

“When looking at this issue of credit growth, the likes of ABS, RBA and economists often forget that Australia typically adds 350,000 people and 200,000 more homes every year.

“More people, more homes should always mean more credit – otherwise we would be in a recession and lose jobs.”

ANZ slows mortgage leakage

The latest APRA data shows ANZ had $ 260.356 million in owner-occupied housing and investment mortgages at the end of October, about $ 66 million less than at the end of September.

That’s much slower than previous leak rates, with the bank at one point losing $ 1 billion in mortgage customers in a month – where refinances and releases outpaced the rate on new loans.

The ANZ mortgage leak has been well documented and has been attributed to slow application and approval times, particularly through brokerage channels where some clients wait up to six weeks.

ANZ chief executive Mark Hand previously said this was “a level we weren’t happy with.”

CommBank is generally leading the growth rate among the majors, increasing its homeowner loan portfolio by just about $ 3 billion in the last month on record.


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