First home buyers fade, investors rise

Investors are coming back into the property market at a rapid clip.

Monday, August 5th 2024, 10:11AM

New figures from the Reserve Bank show annual growth in new mortgages to investors rose by 11.5%, while first home buyer growth fell back 12.5% and movers declined to 1.1%. Growth in mortgages for business purposes rose a significant 43.9%.

While the share of new mortgages to investors fell slightly on a monthly basis, down to 18.6% in June from 18.9% in May, that figure is still a substantial increase on the 16.5% in June last year.

For first home buyers the share was at 21.6% last month, up from 21.4% in May, however, this is an annual drop from 24.4% in June last year.

Movers’ share of new mortgages fell to 57.9%, down from 58.3% in May-24. In June last year, the share was 57.8%.

In total investors took out $1,047 billion in new mortgages last month compared to $1,304b in May and $939 million a year ago; first home buyers $ 1,212b, down from $1,480b in May and $1,385b a year ago; and movers signed mortgages for $3,252b last month compared to $4,030b in May and $ 3,288b a year ago.

The total amount of new mortgages written in June dropped by $1.3 billion to $5.6b, down 18.7% on May. This is a monthly drop of 1.2% when compared to June last year. The seasonally adjusted total value of new mortgages declined by 3.6% from May.

As new mortgage totals declined in June, so did provider loan changes, down by 13.8% from May but still a 14.2% increase compared to a year ago. Top-ups and property purchases also dropped by 21.3% and 22.5% respectively in June.

In the month there were 14,590 new mortgages written, down 20.5% from 18,348 in May. This figure has dropped 5.9 per cent from 15,498 a year ago.

The average new loan value across all borrower types increased to $384,990, up 2.2% from $376,553 in May. In comparison to June last year, average values across all borrower types have increased by 4.9% from $366,886.

The average value of loans for first home buyers increased by 0.7% from May and the average value for investors rose by 1.7% over the same monthly period.

Tags: first home buyers