Australian owner occupier housing finance approvals down 3 percent: Westpac's Matthew Hassan
GUEST OBSERVER
Australian housing finance approvals to owner occupiers fell 3 percent in August, below market expectations but basically in line with Westpac’s forecast and industry data.
The decline follows a 4.5 percent fall in July and underscores the uneven conditions in Australia’s housing markets which are weak in terms of finance activity and turnover but have firmed according to other, more timely indicators such as auction clearance rates and some price measures.
The detail showed owner occupier approvals ex refi somewhat firmer in the month (–1.3 percent/mth) and an uptick in construction related approvals.
The value of investor approvals was roughly unchanged and total value of approvals up a tick (+0.2 percent/mth).
By state, owner occupier approvals were down more sharply in Vic (nearly 10 percent ex refi).
Our understanding of the data is that it should exclude loans to non residents and hence should be unaffected by recent moves by banks to cut back lending to this segment.
However, in practise this measure has often had issues about data quality including how loans are classified by respondents. Hence it is possible that these changes have impacted.
Details
Owner–occupiers (no.) –3%mth, –4.2%yr
– ex-financing (no.) –1.3%mth, –7.4%yr
Construction of dwellings (no.) 3.7%mth, –1.7%yr
Purchase of newly built dwellings (no.) –0.3%mth, 5.7%yr
Value of loans:
Owner-occupiers ($bn) –1.6%mth, –4.9%yr
Investors ($bn) 0.1%mth, –5%yr
Total ($bn) –1%mth, –4.9%yr
Total ex refi ($bn) 0.2%mth, –6.3%yr
Matthew Hassan is senior economist with Westpac.