Both owner-occupiers and investors remained active in the lending market over the first three months of 2020, surpassing the activity they recorded last year, according to the latest figures from the Australian Bureau of Statistics.
The number of loans to owner-occupiers who purchased or constructed new houses was 13.2% higher than the same time last year. Investor lending also increased, up by 6.5% from the same period.
Also read: Investor Rates Likely To Stay Low
Tim Reardon, chief economist at the Housing Industry Association, said the recent lending data are amongst the indicators pointing to a strong housing market this year.
"These results show that up to the end of March, we were looking at solid home building activity across most regions in 2020. They also confirm that the housing market had reached a turning point mid-way through 2019, providing further evidence that the housing market, pre-COVID-19, was heading into 2020 looking upwards," he said.
The value of housing loan commitments increased by 1.2% from last month and by 22.5% from last year. The value of investor loan commitments, however, declined by 2.5% monthly but increased by 5.3% annually.
Adrian Kelly, president of the Real Estate Institute of Australia, said these figures did not reflect the full impact of the COVID-19 outbreak, given that loan commitments for the month included applications submitted in February, or the first half of March before restrictions were introduced across Australia.
"With lending institutions reporting a considerable slowdown in new loan applications from the end of March, as both restrictions on movements and caution about the economy impact on activity in the housing market, we may find the March finance figures will be a high point for some months to come," Kelly said.
