Home loan sizes plummet

19 April 2016
| By Anonymous (not verified) |
image
image
expand image

Home loan sizes declined 7.7 per cent in the three months to February 2016 or by $29,100, reflecting increasing pressure on the Australian home loan market, said Finder.com.au

The Australian comparison website said it's the biggest three-month drop since May-June 2000, with the average home loan now being $357,200.

The website also said it's the first time on record, the average home loan size dropped by more than one per cent in three consecutive months, with South Australia was the only state to have an increase in loan sizes, with an increase of 0.62 per cent in February.

The site said New South Wales reported the biggest decline on record, "where the average home loan size dropped by 5.75 per cent in February. It dropped by 10.15 per cent or $45,500, in the last quarter."

Money expert at Finder.com.au, Bessie Hassan said, "tougher bank lending policy introduced during mid-2015", are finally taking affect.

Hassan said, "banks are securitising new loan application more closely, taking a tougher line when assessing borrowers income."

On the three month scale, home loan sizes dropped in every state, with Victoria and Queensland down by six per cent, while South Australian, Western Australia and Tasmania were down between two to three per cent, said finder.com.au

Finder.com.au said this is reason the housing market has been decelerating, as year-on-year median capital city prices only clawed up by 0.2 per cent.

Hassan said there is positive in this situation as, "the home loan market will be under pressure, and banks will be eager to secure new customers…this could lead to an increase in housing affordability with interest rates declining even further."

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

GG

So shareholders lose a dividend plus have seen the erosion of value. Qantas decides to clawback remuneration from Alan ...

2 months 1 week ago
Denise Baker

This is why I left my last position. There was no interest in giving the client quality time, it was all about bumping ...

2 months 2 weeks ago
gonski

So the Hayne Royal Commission has left us with this. What a sad day for the financial planning industry. Clearly most ...

2 months 2 weeks ago

A Sydney-based financial adviser has been banned from providing financial services in the interest of consumer protection after failing to act on conduct concerns. ...

3 weeks 6 days ago

Insignia Financial has made four appointments, including three who have joined from TAL, to lead strategy and innovation in its retirement solutions for the MLC brand....

1 day 6 hours ago

ASIC has cancelled the AFSL of a $250 million Sydney fund manager, one of two AFSL cancellations announced by the corporate regulator....

3 weeks 4 days ago