Mortgage activity rises to highest point since August 2009: RP Data
The mortgage market rebounded strongly in February on the back of increased levels of consumer confidence and more attractive fixed and variable mortgage rates, according to the latest RP Data Mortgage Index.
The index has surged over the past eight weeks reaching 100.7 points as of March 10 – its highest reading since August 2009, also the last time the cash rate was at 3%.
The index tracks mortgage activity from 90% of the residential mortgage sector and correlates strongly with ABS housing finance data.
More than a month ahead of ABS housing finance data – January housing finance figures are out tomorrow – it is a lead indicator of demand for residential mortgages.
RP Data’s head of corporate affairs Craig Mackenzie said the latest reading of the index highlights the extent of new market activity between the traditionally slow month of January and February.
“In seasonally adjusted terms, the index increased from 76.9 to 78.1, foreshadowing a strong result for February when the housing finance data is released by the ABS in mid-April.
“Of greater significance is the fact that the raw Index value of 100.7 over the 28 days to March 10 was the highest since September 2009, which was a point in time when market activity was very strong, underpinned by high levels of first homebuyer activity stimulated by low interest rates and the First Homebuyer Grant Boost.
“This is supported by the fact that the average number of activity events across RP Data’s platforms per client was the highest since August 2009.
“This suggests mortgage market activity has rebounded strongly in February after the post-Christmas lull, driven by increased levels of consumer confidence, attractive mortgage interest rates (both fixed and variable) driving strong refinancing activity and improved investor demand,” Mackenzie said.