Owner occupier finance approvals better than expected in September: Westpac's Matthew Hassan

Owner occupier finance approvals came in better than expected for September, with the detail a little softer but separate figures on the value of investor finance loans on the strong side.

The number of owner occupier approvals rose 1.6%, well above the market expectations of a 1.6% fall. Industry data on bank loans had been soft in the month.

The gain was led by strong refi activity – ex refi loans were up just 0.5% and down in value terms (–0.8%mth) implying average loan size was quite a bit smaller.

Other detail showed a flat month for construction-related lending.

By state, there were solid gains for total owner occupier loans in NSW, Vic, Qld and SA with a decline in WA.

The 4.6% rise in the value of loans to investors is notable as it means the total value of housing finance loans is up in the month with a clear firming since the recent low in April – that in turn suggests other data pointing to a firming in housing market conditions is genuine and that the bulk of the lift is coming from domestic investor activity.

Details 

Owner–occupiers (no.)   1.6% mth, –3.7%yr   
– ex-financing (no.)       0.5% mth, –7.8%yr                      

Construction of dwellings (no.)      –0.8% mth, –5.2%yr      
Purchase of newly built dwellings (no.)   5.9%mth, 5.7%yr                            

Value of loans:             

Owner-occupiers ($bn)   0.9%mth, –5.4%yr    
Investors ($bn)      4.6% mth, 9.6%yr          
Total ($bn)              2.3% mth, –0.2%yr        
Total ex refi ($bn)   1.8% mth, –1%yr