Tag Archives: finance
Lending for homes in Australia down almost 10% compared to a year ago
The total number of new home loans approved in Australia declined again during June which has led to concerns being voiced about a tightening in the mortgage market. Data from the Australian Bureau of Statistics shows that the total number of new housing loans to owner occupiers fell by 0.5% on seasonally adjusted terms was 9.1% lower than 12 months earlier. During June, the number of owner occupier loans for new home construction fell by 0.4% and the volume of loans for new home purchase declined a little more sharply during the month with a fall of 0.8%. A breakdown of the figures show that compared with 12 months ago, the number of owner occupier loans for the construction or purchase of new dwellings increased in New South Wales by 12.9%, in South Australia by 9% and in the ACT by 0.5%. But they fell elsewhere with the largest fall in Western Australia with a decline of 21.4%, followed by a fall of 20.8% in Tasmania and a 20.8% fall as well in the Northern Territory. Other states also saw loan approvals go down but at a less steep rate. They fell by 7.8% in Queensland and by 4.8% in Victoria. ‘This is the second consecutive monthly decline in new home lending. An adequate flow of housing finance is vital to ensure that the pipeline of new housing supply meets Australia’s long term needs,’ said Housing Industry Association senior economist Shane Garrett. ‘We’re concerned by the apparent tightening of home lending conditions in both the owner occupier and investor markets as a result of APRA intervention,’ he added. ‘Safeguarding the integrity of Australia’s financial system is obviously of paramount importance, but recent regulatory intervention risks obstructing new home building and damaging the economy’s long term growth capacity,’ he warned. Continue reading
Housing supply in UK fell significantly in July, new index shows
The number of UK home owners putting their properties on the market fell dramatically in July, down 13.2% across the UK and almost 15% in London, according to the latest property supply index. The majority of locations have seen new stock levels fall in the past month with Glasgow and Edinburgh seeing new property listing fall by 30.3% and 29.7% respectively while supply was down 28.2% in Milton Keynes and 28.1% in Sunderland The index from online estate agent House Simple, which used new listing on Rightmove in July compared to the previous month of more than 100 major towns and cities and all 32 London boroughs, also shows that while Swindon saw a 40.5% rise in new property listings in June, they fell 25.2% in July. Meanwhile, a quarter of the towns and cities that saw the biggest falls in new property listings in July were in the south west of England. A fifth were each in the south west of England and the West Midlands. In London new property listings fell 14.9% in July and only the borough of Bromley saw increase in new stock, but this was still less than 1%. Bexley saw new property listings fall by 31.4%, while new stock levels in Kensington and Chelsea, a favourite with foreign buyers, fell by 24.5% ‘Any hope that sellers were finally returning to the market seems to have been a vain one for the time being,’ said Alex Gosling, chief executive of House Simple, adding that the reasons are not easy to ascertain but it could be due to prices rising. ‘Or maybe they’re not confident about market conditions, despite the strength of the economy and the highly competitive mortgage rates on offer at the moment. Somehow, sellers need to be encouraged back to the market because there are buyers galore waiting when they do. It’s a very attractive market right now for motivated sellers,’ he pointed out. ‘The next few months are going to be important as the property market looks to gather momentum heading into the last quarter of the year. We fully expected activity to drop off in the summer months, but come the Autumn the market needs to replenished with stock to realign the supply versus demand balance,’ he concluded. Continue reading
First time buyer lending up but still down on a year ago, latest mortgage data shows
Lending to first time buyers in the UK increased in June but overall has changed little since the same month a year, ago, according to the latest report from the Council of Mortgage Lenders. Home mover lending also increased and saw a slight yearly increases in volume and value while home owner remortgage activity increased by over a third month on month and year on year. The CML data also shows that buy to let continues to grow year on year and month on month, mainly driven by buy to let remortgage activity. The first quarter of the year saw the mortgage market slow but now lending to first time buyers increased in number and amount by over 20% in the second quarter of 2015. ‘Notable this month is the uptick in remortgage activity among home owners, perhaps reflecting an increased desire to lock into competitively-priced mortgage deals in advance of any rise in rates,’ said Paul Smee, director general of the CML. ‘It is likely that people are now beginning to feel a rate rise is a realistic prospect and not just a distant theoretical possibility. After a slower than expected start to the year, lending now appears to be picking up as we expected, and in line with our recently revised forecasts,’ he added. According to Adrian Gill, director of Your Move and Reeds Rains estate agents, a shortage of affordable properties is affecting the prospects for first time buyers. ‘While the demand hasn’t gone anywhere, the goalposts have shifted. Even with a leg up from government schemes, those looking to make their first foray onto the ladder are having to be more open minded about what they can afford, and these home buying incentives and cheap mortgage finance won’t hang around for ever either,’ he said. ‘In the long term, those who can’t act now will be reliant on more house building to replenish the stock of homes available, and keep mortgage repayments and deposits within grasp,’ he added. Tougher regulation is restricting lending for affordable homes, according to Patrick Bamford, director of mortgage insurance Europe for Genworth. ‘Even improved affordability of loans is not enough to produce a notable increase in first time buyer activity year on year,’ he explained. He also pointed out that following the recession there has been a drastic fall in home ownership, particularly among younger people, across all regions of the UK impacted by high house prices and a lack of supply. ‘The South East and North West have been particularly hard hit, with the shortfall in numbers when compared to pre-recession greater than the entire populations of Brighton and St Helens respectively. We are still a long way from closing the gap and returning to a normal first time buyer market,’ said Bamford. ‘It is crucial for the government to introduce a permanent system of private mortgage insurance to accompany its planning reforms and drive a thorough recovery of the… Continue reading
