Australia: October housing finance approvals better than expected - Westpac
|Matthew Hassan, Research Analyst at Westpac, notes that Australian owner occupier housing finance dips 0.6%, investor lending up 1.6%, both holding up much better than expected.
Key Quotes
“Australian housing finance approvals continue to hold up much better than expected given the material housing market slowdown evident in auction clearance rates, prices and turnover.”
“The total number of owner occupier finance approvals dipped 0.6% in Oct vs expectations of a 1.3% decline and industry data that had been even weaker.”
“Ex refi, approvals were down 0.8%mth. Both measures remain above year ago levels.”
“The value of investor housing finance was even more inexplicable, posting a 1.6% rise. Despite macro-prudential measures impacting investors more heavily, the value of approvals in this segment are only down 6.1%yr.”
“The total value of finance approvals ex refi is still up 2.4%yr. That compares to turnover, down around 15%yr, auction clearance rates, down over 12ppts, and an abrupt slowdown in price growth, down from a double digit pace mid-year to a sub-5% annual pace currently.”
“The apparent disconnect between the finance data and the wider market performance remains something of a puzzle.”
“For some time now we have been looking for a fall in finance approvals but as at Oct the series is still holding up much better than expected.”
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