Pete Wargent blogspot

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

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Wednesday, 10 June 2015

AFG record May for mortgage lending

Record May for AFG

Australia's largest mortgage aggregator Australian Finance Group (AFG) released its May 2015 mortgage figures, and it proved to be the biggest May on record. 

The group wrote 10,668 mortgages in the month (note that the index is not seasonally adjusted).

The total value of loans in the month broke $5 billion for the second time in May at $5,017 million.

The first time this barrier was broken was in March of this year.

This result represents a thumping 18.9 per cent increase on the May 2014 figure, with the record values written driven predominantly by a surge refinancing.

Consequently the proportion of loans written to investors pulled back from 43.1 per cent in April to 40.9 per cent in May.

Non-major lenders increased their market share from 25.3 per cent in April to 28.1 per cent in May, which is an interesting point given the recent tightening in lending standards.

AFG noted that many borrowers believe that we are now close to the bottom of the interest rate easing cycle.

Despite this, Reserve Bank Governor Glenn Stevens noted in his Brisbane speech today that the Reserve remains "open to the possibility of further easing".

So we many not have seen the last of the interest rate cuts just yet.

Index goes quarterly post listing

Historically AFG has released its Mortgage Index on a monthly basis.

However, following AFG’s successful listing on the securities exchange, the group has determined that its Mortgage Index will then be published on a quarterly basis from July 2015.