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Australia’s investor lending rose during the month of August as the effects of June/July rate cuts and APRA changes have continued to flow through to housing finance, according to the latest report from ANZ Research.
Investor lending was up 5.7 percent m/m in August ex-refinancing, the second-strongest monthly result since May 2015 and a continuation of investor demand after a 4.7 percent m/m result in July 2019. Annual growth in investor lending is still sharply negative (-13.0 percent y/y to July), however this is the smallest negative result in almost two years.
Owner-occupier lending grew 1.9 percent m/m in August ex refinancing. Annual growth is still slightly negative (-1.7 percent y/y), but it is the smallest negative result since June 2018, when y/y owner-occupier demand growth was still positive.
Regulatory easing in July (APRA relaxed the 7 percent + floors on mortgage serviceability) has heightened the effects of rate cuts, by allowing lower rates to more directly affect serviceability assessments, the report added.
"Optimism in the housing market following a sharp uptick in Sydney and Melbourne prices may have also spurred on extra demand from investors," ANZ further commented in the report.
