What's driving this increase?
Loan Market reported a 23% rise in home loan applications across Australia at the start of the real estate selling season compared to the same period last year.
The national mortgage brokerage attributed the increase to a surge in property listings since September 1, which has drawn more buyers to the market.
The brokerage noted significant growth in home loan applications across the eastern states, with New South Wales seeing a 45% rise, Queensland 22%, and Victoria 17%.
Angela Tracey (pictured above), chief marketing officer at Loan Market, noted that the increase in buyer activity was driven by multiple factors.
Loan Market also recently reported a 23% increase in finance pre-approvals, with buyers gaining confidence from a rise in property listings ahead of the spring season.
“Buyers have been encouraged by the increase in market listings, offering greater choice and comparisons in their property hunt,” Tracey said. “But there’s a rising element of FOMO with the talk of future interest rate cuts likely to bring more competition to the market.”
While inflation remains persistent in some parts of the economy, most economists believe Australia is past the risk of further cash rate hikes. Last week’s 50 basis point cut by the US Federal Reserve has increased speculation over when Australia might follow suit. Several banks have already started pricing in potential cuts to their variable rate offerings.
According to Tracey, there has been an uplift in the number of buyers wanting to get into the property market this selling season.
“Brokers are also seeing a greater level of demand, with brokers now writing around three in every four home loans in Australia,” she said.
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