Increasing property confidence drives Australian mortgage industry
Australian Finance Group Limited (AFG), an Australian mortgage broker reports that one in three new mortgages was sold to property investors, as opposed to owner occupiers, during March. And AFG Mortgage Index shows that 32.9% of all new mortgages were sold to investors – the peak figure AFG has recorded in the four years it has been running the index.
Rapidly increasing confidence in property is being largely driven by a resurgent New South Wales, where 34.4% of new mortgages were sold to investors. Last time New South Wales saw this proportion of property investors was in May 2005. This figure complements the growing property investment markets in Queensland, where 31.2% of new mortgages were sold to investors, and the continuing strength of the WA market, where 46% of all new mortgages are for investment purposes.
In Victoria, 25.5% of new mortgages were sold to investors. While this figures is well below the national average, it is still better than for the same period last year, when only 18.9% of new mortgages were for investment. South Australia also recorded a relatively better month with 27.4% of new mortgages sold to investors, compared to 20.1% the month before.
According to AFG, While one should be cautious about reading too much into a single month’s data, it would seem that AFG at last seeing the long-awaited return of confidence to the New South Wales property sector, and even Victoria is coming out of the gloom. If this trend continues over the next few months, mortgage sector could be in the golden scenario where property markets, coast to coast, are powering forward.
AFG Mortgage Index also showed that the average new Australian mortgage now stands at $308,000, slightly above than the previous high of $307,000 recorded for November 2006.
While AFG figures are not definitive, they are usually strongly indicative of more comprehensive figures released later each month by other institutions.
4-May-2007