Figures released by the Australian Bureau of Statistics have revealed that home loan approvals soared to an eight-year high in December 2015.
The number of approvals rose 2.6 per cent in December to 58,552, while their value increased by 0.8 per cent to $33.5 billion.
Loans to buy new dwellings were incredibly popular, increasing by 12.4 per cent for December. Lending to build was also up by 1.8 per cent, and lending for established homes was up by 2.1 per cent.
Among the states, lending rose the most in Queensland (up 9.6 per cent), followed by New South Wales (3.5 per cent), Western Australia (0.7 per cent), Tasmania (4.4 per cent), South Australia (1.0 per cent) and Victoria (0.1 per cent). Price falls were recorded in the Northern Territory (down 16 per cent) and the Australian Capital Territory (3.6 per cent).
So why is lending up when it seems like the property market seems to be cooling down? It would seem that owner-occupiers are making their way back into the market and taking the opportunity to get into the market while there is less competition and tougher lending conditions on investors.
The ABS data seems to reflect this, with investment lending up by 0.6 per cent to $11.638 billion after rising 0.7 per cent in the previous month.
Owner occupied home loans accounted for a larger slice of the pie, up by 0.9 per cent to $21.88 billion.
It’s important to keep in mind that this is what the Reserve Bank and APRA tried to engineer when they decided to put tougher restrictions on lending criteria last year.
While property prices won’t grow as rapidly as we saw them last year, they are still likely to grow, albeit at a much slower and more sustainable pace.
If you’re interested in buyer or selling, whether you’re an investor or plan to find a home, then don’t hesitate to get in touch with Arbee Real Estate to find information about how property prices might be affected in the local area.