Housing finance data for August 2013 was released earlier this week by the Australian Bureau of Statistics (ABS).
The data release showed that the number of housing finance commitments to owner occupiers fell by -3.9% over the month, largely due to a substantial fall in new loan commitments (-5.3%) as opposed to refinances (-1.0%).
Although commitments fell over the month, new loan commitments are 8.7% higher year-on-year and refinance commitments are 11.0% higher.
The total value of housing finance commitments showed no change over the month, with both investment and owner occupier loans stable.
Year-on-year, the value of investment finance commitments is 25.5% higher compared to an increase of 13.0% for owner occupier loans. Investment finance commitments currently account for 36.3% of the value of all loans, up from 34.0% in August 2012.
Over the month there were 6,978 housing finance commitments to first home buyers which was -12.5% lower over the month and -21.8% lower year-on-year. The latest ABS data shows first home buyers currently account for just 13.7% of the overall owner occupier market, the lowest proportion since April 2004.
Clearly the changes to the availability of incentives for first home purchases whereby the First Home Buyers Grant is only available for new housing rather than established housing across the largest states is having a negative impact of first home buyer activity in the market.
The Reserve Bank (RBA) released the minutes of their October board meeting earlier this week, at that meeting the RBA Board left official interest rates on hold at 2.5%. Specifically relating to the housing market, the minutes noted the following: ‘Household interest payments had continued to decline and conditions in the established housing market had strengthened over 2013.
House prices increased by around 2½ per cent over the September quarter and by 5½ per cent over the year. However, the value of the dwelling stock relative to household income remained below the levels that had prevailed for most of the past decade.
Auction clearance rates remained well above average and turnover had picked up over recent months. Loan approvals for established dwellings for both owner-occupiers and investors had increased strongly over the past year. While the growth of housing credit remained moderate, it was edging higher, with stronger growth in investor credit.’
National Auction Clearance Rates
The number of auctions across the combined capital cities increased last week to 2,229 from 1,501 the previous week. The auction clearance rate also increased over the week, from 69.3% the previous week to 72.5% last week. In Melbourne, there were a total of 1,008 auctions over the week with the clearance rate rising from 71.3% the previous week to 74.0% last week.
Auction volumes across Sydney increased substantially over the week from 398 the previous week to 884 last week, however, the clearance rate remained virtually unchanged, from 79.0 per cent the previous week to 79.1 per cent last week. There are currently 2,204 capital city auctions scheduled for the current week. Clearance rates map
Weekly Advertised Listings
Over the four weeks to 13 October 2013, there were 46,885 newly advertised properties listed for sale nationally. The number of new property listings increased by 2.2% over the week and are 1.1% higher than at the same time last year. Across the combined capital cities, new listings were 2.5% higher over the week and are 3.8% higher than they were a year ago.
There are currently 259,623 properties listed for sale across the country. Total listings at a national level have increased by 0.4% over the week and they are -5.5% lower than they were at the same time last year.
Across the combined capital cities, total listings have increased by 0.5% over the week and they are -12.8% lower than they were at this time a year ago. Capital city listings account for around 43% of all listings nationally.