Mortgage broking group,
AFG have broken a record this September with the overall number of home loans processed by the group reaching a record high of $4.3 billion across the country. This represents a 3.5% increase on the previous record processed in May.
Echoing the concerns of the Reserve Bank around surging investor demand, demand for investor lending drove AFG’s growth in September. These loans accounted for 40.3% of the total loans processed, which is also a record for the group. The previous all-time-high proportion of investment loans was 40%, also recorded in May.
Investment mortgages comprised 49.7% of new home loans processed last month in NSW, 37.2% in VIC, 36.4% in SA, 34.9% in QLD and 32.2% in WA.
Mark Hewitt, general manager of sales and operations says the market can expect to see investor demand remain solid throughout the spring selling season.
“With countries like Canada making it more difficult for overseas residents to invest in property, very strong demand from investors can be expected this spring. The concern however is for first home buyers. Historically, this segment has comprised around 15% of all the loans we process, but in recent months this figure has fallen into single digits.”
AFG also reported first home buyer demand hit a record low for the group. September saw first home buyers account for just 8.4% of new home loans processed. This figure was down from a previous low of 9.5% last month and a figure of 11.3% in September last year. First home buyers comprised 3.7% of new home loans in NSW, 5.1% in QLD, 7.5% in SA, 9.1% in VIC and 18.5% in WA.
