Housing loan approvals lift as investors come back into the market

New housing loan approvals rose strongly in March, up 5.5% over the last month with around 55% of the increase driven by investors.

Contributing to the monthly increase was lending to investors, which saw a 12.7% increase from the month prior. This was the 10th consecutive month that the value of new investor lending commitments experienced an increase and was the largest monthly increase since July 2003, almost 18 years.

Canstar analysis of the ABS Lending Indicator data reveals mortgage holders refinanced $13 billion worth of loans to a new lender in March 2021, down 1.6% from the month prior but up 21.8% year on year.

The data also shows refinancing with the same lender (internal refinancing) reached $8 billion in March 2021, up 28.9% from March 2020.

Summary of the ABS Lending Indicators March 2021 data reveals:

• The value of new loan commitments for housing in March increased to $30.2 billion, up 5.5% from the month prior while increasing 55.3% from March last year.

  • The value of new loan commitments for owner-occupiers in March increased to $22.4 billion, up 3.3% from the month prior and 55.6% year on year

  • The value of new loan commitments for investors in March reached $7.8 billion, up 12.7% from the month prior and 54.3% year on year

• The value of owner-occupier construction lending fell by 14.5% in March to reach $3.64 billion, though is still up 123.6% year on year.

• The value of external refinancing decreased by 1.6% from the month prior though remains up 21.8% from March last year. Mortgage holders externally refinanced $13 billion worth of home and investment loans in March 2021.

• The value of internal refinancing increased by 13.2% from the month prior and 28.9% from March last year (in original terms). Mortgage holders refinanced $8.4 billion worth of home and investment loans with their existing lender in March 2021.

• The number of owner-occupier first home buyer loan commitments fell by 3.1% from the month prior, to reach 15,623. The number of first home buyers is up 58.3% year on. year

• Owner-occupier first home buyer loan commitments accounted for 33.7% of all owner occupier commitments (excluding refinancing), in original terms.

Source: Housing loan approvals lift as investors come back into the market (propertyupdate.com.au)