The Australian Bureau of Statistics (ABS) collects data on housing finance commitments made by significant lenders and their figures include secured (mortgage) finance commitments for the construction or purchase of owner-occupied dwellings and investment properties. It has some overlap with the RBA’s monthly private sector credit statistics which also includes investor lending and owner-occupier lending.
The ABS has released housing finance figures for May and they were higher than market expectations. However, bond yields finished the day lower despite higher US yields in overnight markets. 3 year bond yields fell by 4bps to 2.06% and 10 year yields lost 3bps to 2.61%.
The number of owner-occupier approvals increased by 1.1% compared to April, which was higher than the 2% fall expected. Excluding refinancing, the number of approvals increased by 1.8%. On a year-on-year basis, owner-occupier approvals fell by 2.5% and after excluding refinancing, the value of approvals fell by 2.8%.
In dollar terms, the total value of loan approvals, excluding refinancing, increased by 0.4% for the month. On a year-on-year basis, the total value fell by 5.3%.
Finance approvals for owner-occupiers have slowed but by nearly as much as the investor segment. The total value of owner-occupier loan approvals, excluding refinancing, increased by 0.8% in May, following a revised 0.3% increase in April. On an annual basis, May owner-occupier loan approvals increased by 1.6%, down from April’s comparable figure of 2.4%.