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National home loans down again – And the decline is set to continue - featured image
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National home loans down again – And the decline is set to continue

Home loan activity has continued its recent decline as falling affordability driven by booming house prices increasingly constrains buyers.

The ABS data reveals that the total value of home loans seasonally adjusted fell by 1.1% over July which follows similar declines over June.

Although home lending has fallen over recent months, activity remains at near record levels.

The value of home loans approved over the first seven months of 2021 seasonally adjusted increased by remarkable 65.4% compared to the same period last year.Abs Finance 1

Most states reported declines in home landing over July with New South Wales and Northern Territory however reporting increases.

Abs Finance

Underlying home buyer appetite however generally remains strong with the easing of restrictions, hopefully sooner rather than later, set to drive a sharp revival in activity as evidenced when lockdown ended last year.

However, sharply higher house prices have predictably acted to moderate buyer activity as rising affordability constraints continue to ease home lending.

About Dr Andrew Wilson, Chief Economist of www.MyHousingMarket.com.au is widely regarded as Australia’s leading property economist.
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