Since late 2017/early 2018, a very clear downtrend has been evident in the monthly figures of both the number and value of home loan commitments. After the figures from February were released, some economists speculated the worst may have been over. The latest numbers have made that suggestion unlikely.
The ABS has released March’s housing finance commitment figures* and they were less than expected. The total number of loan commitments to owner-occupiers decreased by 2.5%, a larger contraction than the expected -0.5% and a reversal of February’s revised figure of +1.4%. On an annual basis, the growth rate further deteriorated to -11.3% from -10.8% after revisions. When “re-financings” are removed, the number of loan commitments fell by 2.8% over the month and by 13.8% when compared to commitments from March 2018.
ANZ economist Adelaide Timbrell summed up the report in the following way. “All categories of housing finance posted sharp losses and were below market expectations. Owner-occupier finance was hit hardest, although this may be a correction to last month’s spike of owner-occupier finance, which was the highest monthly gain since August 2017.”
