Value of Loans is Falling
The value of loans is on the rise but the number of owner-occupied home loan commitments may be on the decline. Stats for May showed owner-occupied home loan commitments fell 1.2 per cent, but the value of loans rose by one per cent. This suggests that people may be looking at more expensive properties when they do get finance approved.
The average size of loans to first home buyers in May was $285,700, the largest since the same time last year. But there’s bad news for the construction sector, with the number of loans for the purchase of new homes dropping 7.03 per cent. The impact of the cuts to first home owners grants is obvious, with first-home buyers making up 17.8 per cent of new loans, compared to more than 30 per cent when the grants were in place and interest was at record highs.