The value of residential dwelling loan approvals has flattened out in recent months, totaling AUD23.5 billion in November 2014. That total is some 5.4% higher than for November 2013 but is marginally lower than the monthly peak of AUD23.8 billion established in October 2014.
Long run data available on the FWPA Data Dashboard demonstrates the impact on the value of loan approvals of house price inflation and even pent up demand. It was just one year earlier for instance, in November 2012, when the value of monthly approvals hit their highest level in almost three years at just AUD17.7 billion.
Beyond the headline figure, it’s the details where there is greatest interest, with stagnation across the board turning into frustration for new home-buyers as investors gain an ever larger share of the loan market.
The chart below shows residential dwelling loan approvals from December 2010 to November 2014.
Fig 4
To go straight to the dashboard and take a closer look at the data, click here.
In November 2014, for the first time, owner-occupiers and investors received loans at essentially the same aggregate value. Owner-occupiers received loan approvals of AUD11.75 billion dollars, while investors were just AUD30 million short of that at AUD11.72 billion.
As a sub-set of owner-occupiers, first home-buyers accounted for AUD1.92 billion of loan approvals in November 2014, or 16.3%. Of the total loan approvals, first home-buyers accounted for just 8.1% of the total of all loans.
That’s a fall from 9.2% in November 2013 and a larger fall from 12.9% in November 2012.
On these numbers alone, housing affordability, or at least access to credit, is proving more and more difficult for first home-buyers.
In addition, it seems difficult to escape the conclusion that the rising value of loans to investors is correlated to the rising proportion of Australian residential approvals that are in 4+ storey apartment blocks.
