August 4, 2022
  • August 4, 2022

New home loans fall at fastest pace in two years

By on August 2, 2022 0

New mortgage commitments fell for all types of buyers in June, with first-time home buyers – the cohort of borrowers most exposed to rising borrowing costs – being the hardest hit.

The value of new home loans for first-time buyers fell 10% from May to a seasonally adjusted $4.5 billion in June, the biggest drop in three-and-a-half years and the lowest monthly total in two years. .

“In most states, first home purchase loans are back near pre-HomeBuilder levels,” Ms. Kilroy said.

New borrowing by investors fell 6.3% month-on-month in June, the biggest drop in this category in just over two years, to $10.5 billion.

Total new homeowner mortgage commitments fell 3.3% from May to $20.5 billion.

Home values ​​are already firmly down, falling 1.3% month-on-month in July, CoreLogic figures showed on Monday.

The third consecutive month of national decline hides variations between different cities and regions, with Sydney leading the country with a 2.2% drop from June, even as Perth recorded a 0.2% increase in month on month, Adelaide rose 0.4% and Darwin 0.5%.

But with home loan levels still at historically high levels, they are only expected to fall if borrowing costs rise further.

This will further weigh on prices.

“The price falls are now spreading to other cities, with five of the eight capitals now seeing declines, including Brisbane, Hobart and Canberra – and the other cities are seeing a slowdown in price gains,” the chief economist said. of AMP Capital, Shane Oliver, earlier this week.

“House prices are falling faster than house prices, after the former rose faster during the boom and housing is benefiting from relatively firmer investor demand.”