Fresh figures from the Australian Bureau of Statistics (ABS) show that demand for mortgages recovered in February after experiencing a slight drop during the first month of 2016.
According to the ABS, 56,562 home loans were approved throughout February – up 1.5 per cent from 55,754 in January.
Mortgage Choice CEO John Flavell said the bounce back in mortgage demand was in line with expectations.
“Home loan demand always tends to pick up after January as people settle back into work and start to put their property plans or ambitions for the year ahead into practice,” he said.
Mr Flavell said it was clear Australia’s property market was continuing to thrive, with more than $32 billion in home loans approved throughout February.
“Almost $12 billion in investment loans were written, up 4.1 per cent on the month prior. Meanwhile, the value of all owner-occupied home loans written was just over $20.9 billion, up 1.7 per cent from January,” he said.
“Further, auction clearance rates are strong, interest rates remain at historical lows and dwelling values continue to climb across the combined capital cities month-on-month. All of this data suggests the property market is doing well and will continue to do so for some time yet.”
Mr Flavell added that the ABS data suggested Australian borrowers were more interested in buying established dwellings than new properties.
“Over the month of February, just 2,577 home loans were approved for the purchase of new dwellings, down 15.4 per cent on the month prior,” he said.
“By comparison, 48,256 home loans were approved for the purchase of established dwellings, up 3.0 per cent from January.
“It is now more important than ever for Australia to get our property supply type right. We need to make sure we are building dwellings people want to buy. Property demand is likely to remain strong for the foreseeable future so we need to make sure we are generating the right type of supply.”