Investors were ramping up their participation in the market before the COVID-19 outbreak started taking its toll on the economy and the property sector, according to data from the Australian Bureau of Statistics (ABS).
Investor lending grew by 3.4% in the three months to February. On an annual basis, the investor segment recorded a 6.3% gain in financing.
"These results show that at least until the end of February, we were looking at solid homebuilding activity across most regions in 2020," said Angela Lillicrap, economist at Housing Industry Association (HIA).
The owner-occupier segment also recorded a substantial gain in overall home lending, up by 12.3% from last year. This was driven by the 12.7% increase in loans for the purchase or construction of new homes.
"These results, along with other leading indicators such as new-home sales and building approvals data, continue to confirm that the housing market reached a turning point mid-way through 2019," Lillicrap said.
Recent ABS figures also showed a solid growth in building approvals in the month. On a trend basis, the number of dwellings approved grew by 1% over the month, driven by the construction of apartments.
"A significant rise in the number of apartments approved in February has offset the weakness recorded in January," said Daniel Rossi, director of construction statistics at ABS.