Appetite for investor loans falls

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Property investors seemed to have taken a break in September, with investment property loans declining by 4%, according to the latest figures from the Australian Bureau of Statistics (ABS).

The overall value of investor lending slumped after recording a robust growth during the previous month. From a year ago, investment loans were down by 14%.

Queensland recorded the most significant decline in investor financing at 7%, followed by Victoria's 6.5%.

Investors accounted for less than 25% of total loans, its lowest share of housing finance since 2002, CoreLogic head of research Tim Lawless said in a tweet.

As investor lending retreated, the owner-occupier segment continued to expand, recording a 3.6% gain. This steady monthly growth was due to the 4.8% increase in finance commitments for the purchase of established dwellings.

On the other hand, loan commitments for the purchase of newly constructed dwellings and first-home buyers declined over the month, down by 2.9% and 1.9%, respectively.

If the 3.1% decline in refinancing commitments is included, the growth in owner-occupier loans becomes a little subdued at 1.4%.

New loans to upgraders and downsizers saw the most substantial monthly growth since June 2015, increasing by 6%.

"With all major states seeing growth, this is a clear sign recent stimulus measures are working to encourage greater housing demand," said Maree Kilroy, an economist at BIS Oxford Economics.

However, she said growth drivers have yet to breathe new life to the new housing segment.

"Off-the-plan apartment demand, especially from investors, is expected to take longer to recover than houses, with build quality issues weighing on sentiment," she said.

Top Suburbs : scarborough , wallsend , newcastle , homebush , kawana

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