Housing Finance — January | By the numbers
- Housing finance commitments by value (excluding refinancing) increased by 4.6% in January to $20.734bn, in line with December's rise (revised from 4.4% to 4.5%) and well ahead of the 3.0% lift expected. The rise in annual terms was extended from 14.6% (revised from 14.0%) out to 23.3%; its fastest pace of expansion since December 2013.
- Owner-occupier commitments posted another 5.0% gain on the month after rising by that pace in December, coming in at $15.031bn, as growth over the year lifted from 18.5% to 26.9% to its fastest since November 2009.
- Commitments to the investor segment were up by 3.6% in January to $5.704bn (prior rev 3.0% from 2.8%), accelerating annual growth from 5.5% to 14.7%; its fastest since May 2017.
- Details for loan approvals by number to the owner-occupier segment in January were;
- Loans to purchase established dwellings lifted by 1.1% to 20,881 (3.5%yr)
- Loans for the purchase of newly built dwellings surged by 13.4% in January to 4,283 (48.4%yr)
- Loans for dwelling construction increased by 4.2% to 3,361 (3.7%yr)
Housing Finance — January | The details
January's 4.6% rise in total housing finance commitments was its strongest monthly rise since September 2016 and came after a 4.5% lift in December. In annual terms, growth advanced from 5.5% to 14.7%, which is a pace last seen back in mid 2017. Whereas the previous upswing in housing finance between Q3 2016 to mid 2017 was driven by the investor segment, this current one has been driven by owner-occupiers with the past few months indicating that investor activity is now picking up as well. There are also other fundamentals at play this time around that have supported the upswing, including a more aggressive rate cutting cycle from the RBA, an easing in macroprudential controls and the earlier turn in sentiment post last year's federal election.
Across the states, owner-occupier commitments in January were driven by the 'major two' through an 8.3% surge in New South Wales (43.1%yr) and a 6.8% acceleration in Victoria (30.4%yr). There were more modest rises in South Australia (2.5%mth, 8.9%yr), Western Australia (1.3%mth, 10.3%yr) and Tasmania (4.1%mth, 0.2%yr). Queensland went against the trend in falling by 2.5% in January (16.7%yr).
In the investor segment, most states advanced in the month; New South Wales 4.2% (8.8%yr), Victoria 1.3% (18.8%yr), South Australia 12.3% (20.3%yr) and Western Australia 2.1% (11.8%yr). There were declines in Queensland -0.4% (17.2%yr) and Tasmania -2.7% (15.4%yr).
Housing Finance — January | Insights
