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Investors dominate property market
Wednesday, March 10, 2010
Property investors are dominating the mortgage market, new data from Australian Finance Group (AFG) has found.
According to AFG’s latest mortgage index, 34.1 per cent of all mortgages arranged nationally in February were for property investors – the highest percentage ever recorded by the company.
The amount of investor mortgages arranged was 25 per cent higher than the level of investment loans recorded six months ago in August 2009.
AFG’s general manager sales and operations Mark Hewitt said while investor confidence has been rising for several months, the company had not expected the level of investors in the market to be as strong as it was.
“Investors are now the driving force of the market, encouraged by rising property prices in recent months, and the longer term view that a housing shortfall will continue to underpin future price growth as well as rental yields,” Mr Hewitt said.
"We are pleased to see second tier lenders making a strong return in recent months. Borrowers are starting to see these lenders as a genuine alternative to the majors again.”
AFG data showed second tier lenders accounted for 17 per cent of all new loans written in February, more than the double the proportion that was recorded this time last year.
This figure supports the latest Australian Bureau of Statistics data, which found that bank lending had edged backwards to 88.1 per cent of all loans in the fourth quarter of 2009 – down from a high of 92.5 per cent recorded in the first quarter of the year.
- Real Estate Business Daily
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