Home loan growth likely to slow
Article by Mozo
Home loan applications are likely to fall following a surge last year led by first home buyers, new figures show.
Research by the Australian Prudential Regulation Authority (APRA) has revealed that the value of bank home loans jumped 17 per cent to $910.5 billion in the 12 months to December 31st.
The Commonwealth Bank and Westpac were the major beneficiaries of the market growth.
APRA’s figures also showed that Australian house prices rose 12 per cent last year while total bank deposits grew by only 0.7 per cent over the year. This suggests that the banks will continue to rely, at least in part, on offshore and wholesale funding markets.
Colin Whitehead, a consultant at the market analyst Fat Prophets, told the Australian that expected interest rate rises this year would "take some of the heat out of the housing market" and lead to a fall in mortgage lending.
This article is brought to you by Mozo – Helping you compare home loans