Based on recent figures from the Reserve Bank of Australia, it appears that recent rate cuts have not significantly boosted investor lending.
In October, housing credit rose only 0.3%, helped by monthly growth in homeowner financing of 0.4%.
On the other hand, investor lending has barely budged, recording a meager growth of 0.2% on a monthly basis. Compared to last year, loans to investors decreased by 0.2%, the largest decrease since 1991.
"The absence of a credit boost in the Australian economy reflects both consumer and business caution." Stimulus measures should eventually lead to a recovery in growth credit, but the missing element in all this is trust, "said CommSec. economist Ryan Felsman.
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On an annual basis, total home loans rose 3%, down from the 5% gain recorded in the same month of last year. Total growth in Australian credit increased only 0.1% per month and 2.5% per year.
RBA Governor Philip Lowe said weak loan growth may imply that Australians are taking advantage of rate cuts by repaying their outstanding loans.
"This implied that the increase in new borrowing in recent months was accompanied by a faster repayment of existing loans, as usually happens in the months immediately following a interest rate reduction, "he said in a recent statement.
Recent figures from the Australian Bureau of Statistics show that the value of loan commitments to investors increased in the September quarter.
"The growth of investment loans has not been so strong, however, the value of investment loan commitments has increased by 6.0% over the previous year. quarter, the fastest gain since the December 2016 quarter, "said CoreLogic's chief research officer. Tim Lawless.
However, investors now account for the lowest share of home loan commitments since the start of ABS registrations in 2003, currently accounting for 24.8% of the total value of new mortgage commitments.
When the first set of macroprudential rules was introduced in December 2014, investors accounted for 43% of domestic mortgage demand.
"Housing credit trends are similar in all states, with the value of homeowner loan commitments generally exceeding that of investors," said Lawless.
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