Pete Wargent blogspot

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

4 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 is one of the better property analysts in Australia" - Stephen Koukoulas, MD of Market Economics, former Senior Economics Adviser to Prime Minister Gillard.

"Pete Wargent 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 and charts, the most comprehensive analyst I follow in Australia. If you follow Australia, follow Pete Wargent" - Jonathan Tepper, Variant Perception, Global Macroeconomic Research, and author of the New York Times bestsellers 'End Game' and 'Code Red'.

"Pete's daily analysis is unputdownable" - Dr. Chris Caton, Chief Economist, BT Financial.

Wednesday, 1 March 2017

Housing credit doubles in a decade

Credit growth slower in January

The Reserve Bank of Australia (RBA) released its Financial Aggregates figures for January 2017.

Although housing credit continued to chug along in notching growth of 0.5 per cent in the month, total credit growth sagged to just 0.2 per cent due to negative results for the business and personal sectors.

Housing credit for investors continued to rise to 6.6 per cent across the year to January, suggesting that further hikes may be in the post for investor loans.


Total credit growth was 6.4 per cent, while broad money growth was 7 per cent.


Deposit growth has strengthened considerably as banks look to shore up their capital. 

Even term deposits, understandably out of favour for some time, are recording growth at a double digit pace, with some accounts set to offer bonus interest on larger balances. 


Switcheroo

The total value of outstanding credit has doubled over the past decade to $1.64 trillion.

The exact split of loan purpose between owner-occupier and investor credit remains murky, with a net value of $49 billion having been switched away from investment loans since July 2015.

This reflects the interest rate differential between loan types, but note that the credit growth figures by loan type have been adjusted for the net value of switching. 


The poor monthly result for business and personal credit sees housing resume its apparently inexorable rise in terms of market share.


The wrap

All regulatory eyes will be on the growth in investor loans, with more measures likely to be taken to cool this sector as 2017 progresses.

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