Pete Wargent blogspot

Co-founder & CEO of AllenWargent property buyer's agents, offices in Brisbane (Riverside) & Sydney (Martin Place), & CEO of WargentAdvisory (providing subscription analysis, reports & services to institutional clients).

5 x finance/investment author - 'Get a Financial Grip: a simple plan for financial freedom’ (2012) rated Top 10 finance books by Money Magazine & Dymocks.

"Unfortunately so much commentary is self-serving or sensationalist. Pete Wargent shines through with his clear, sober & dispassionate analysis of the housing market, which is so valuable. Pete drills into the facts & unlocks the details that others gloss over in their rush to get a headline. On housing Pete is a must read, must follow - he's one of the finest property analysts in Australia" - Stephen Koukoulas, MD of Market Economics, former Senior Economics Adviser to Prime Minister Gillard.

"Pete is one of Australia's brightest financial minds - a must-follow for articulate, accurate & in-depth analysis." - David Scutt, Business Insider, leading Australian market analyst.

"I've been investing for over 40 years & read nearly every investment book ever written, yet I still learned new concepts in his books. Pete Wargent is one of Australia's finest young financial commentators." - Michael Yardney, Australia's leading property expert, Amazon #1 best-selling author.

"The most knowledgeable person on Aussie real estate markets - Pete's work is great, loads of good data & charts, the most comprehensive analyst I follow in Australia. If you follow Australia, follow Pete Wargent" - Jonathan Tepper, Variant Perception, Global Macroeconomic Research, author of the New York Times bestsellers 'End Game' & 'Code Red'.

"The level of detail in Pete's work is superlative across all of Australia's housing markets" - Grant Williams, co-founder RealVision - where world class experts share their thoughts on economics & finance - author of Things That Make You Go Hmmm, one of the world's most popular & widely-read financial publications.

"Wargent is a bald-faced realty foghorn" - David Llewellyn-Smith, 'MacroBusiness'.

Wednesday, 13 July 2016

Housing finance flattens

Housing finance flattens

The May Housing Finance figures revealed a headline result of $32.3 billion. 

Investor lending was up by 3.9 per cent in the month to $11.75 billion, but total housing finance has been fairly flat for 15 months now. 

The slowdown in investor lending since the mid-2015 peak has essentially been offset in home lending.

The net effect at the macro level therefore is that the growth in housing finance has been capped.

Note that these figures relate to May. This week lenders announced a range of cuts to home lending rates, with National Australian Bank now offering fixed rate mortgages from as low as 3.75 per cent. 

State versus state

The number of owner-occupier commitments has been falling in Western Australia and the Northern Territory, but rising in South Australia and notably Canberra since the end of the public sector hiring freeze.

The value of commitments has also been trending up in South Australia and the ACT, while APRA's limits have successfully curbed the parabolic rise in lending in New South Wales. 

First homebuyers

The average loan size in May was $357,300, up by $10,000 from one year previously but below the November 2015 peak. 

The average loan size to first homebuyers has been trimmed back over the past year, making it harder for first time buyers to enter the market. 

The first homebuyer average loan size has declined across every state and territory.

The wrap

The May housing finance figures revealed not much of great excitement.

The construction cycle looks close to its peak, with new home finance now declining, and APRA's limits have made it tougher for those without equity or serviceability to source loans, flattening the lending market.

It's as yet unclear what lower lending rates can or will do to the market in the second half of 2016.