A Melbourne-based brokerage has lent credence to the claim a post lockdown surge of activity was sure to materialise in Victoria, with the group having reported a record month of lodgements following the easing of COVID-19 restrictions at the tail end of last year.
Entourage recorded $23.1m in new home finance settlements in November, a 19% increase in the value of mortgages reported for the same month in 2019. Additionally, the group reported $36.6m in lodgements for the month as restrictions on movement were abolished, a 17% increase compared to the same month the year prior.
Entourage managing director Damien Roylance said the November data supported a trend that has been building in the Melbourne market for months.
“The early phases of COVID-19 triggered a rush of refinancing, but in lockdown, activity swung around to customers planning new finance applications,” he explained.
“Our brokers had their diaries booked-out with client meetings right up until Christmas.”
The Australian Bureau of Statistics (ABS) last week reported an 11% increase in the value of new settlements in November across Victoria as a whole, compared to the same period in 2019.
“Lockdown gave a lot of people a new perspective on what they wanted out of their home, life and investments,” Roylance said.
“They stepped out of lockdown and into a marketplace where they can get owner-occupier home loans with sub-2% variable interest rates and they’re seizing the opportunity.”
Notably, first home buyers accounted for 38.3% of new loans across Victoria in November. At Entourage, the subset of borrowers represented around a third of all settlements.
"Beyond November, the entire December quarter represented a significant uptick in customer enquiries at Entourage,” Roylance added.
"Properties were spending less time on the market at the tail-end of 2020 because of the competition in the market."
Roylance said he expects the Victorian Government’s stamp duty concessions to sustain the strong levels of finance activity up until the middle of 2021.
