Pete Wargent blogspot

CEO AllenWargent Property Buyers, & WargentAdvisory (institutional). 6 x finance author.

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Tuesday, 13 October 2015

Around the states: What's happening with property investor loans?

Around the traps...

With owner-occupier loans teeing off, a quick look around the traps at where the macroprudential measures taken by APRA to cool property investment loans are taking the most effect.

Over the past two months investor loans have slowed almost right across the board in original terms.

In New South Wales investor loans have slowed from $6.6 billion at their June peak to $5.5 billion in August, though still remaining up by +20 per cent year-on-year. 

Home loans have surged to unprecedented heights in this state which will remove the sting from the tail.

In Victoria investment loans have ticked back over the past two months from $3.7 billion to $3.1 billion, although volumes do remain +14 per cent higher than one year ago.

In Queensland investor loans are down from $1.9 billion to $1.6 billion, but on a 12mMA basis have hit their highest level since April 2008.

Partly anecdotally, some inner Brisbane property markets have been performing well of late (ex-high density).

Investor loans in South Australia have been junked from above $0.5 billion back to $391 million, and the 12mMA trendline is now heading down.

The trendline for investment loans is also now pointing south in the resources state of Western Australia.

In just two months investor loans in Tasmania have dropped like a stone. This could prove to be volatility, but the trendline has certainly turned south. 

It may be the case that with the market having been so flat in Tasmania for so long, there is insufficient equity available for investors to stump up the more stringent deposit requirements.

The ACT has also seen a very significant decline in investment loans in just two months after a decent run-up.

And while "property bust" seems to be one of the most overused terms in online media today, looking at the data tumbling out of Darwin it may well prove to be a very apt description for what Darwin is heading towards.

Nationally the mining bust is well underway, and once the Ichthys construction phase largesse winds up what follows is likely to be a sharp property correction for the Top End...or possibly worse.