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04/05/2007
Investment in residential property is back in favour as data shows record levels of investment during April 2007, reports News.com.au...
The AFG Mortgage Index shows that last month 33.8 per cent of mortgages were sold to investors rather than owner occupiers in April – an increase on March’s all time high of 32.9 per cent and a significant increase on the figure of 28.3 per cent recorded 12 months ago.
Western Australia and Queensland continue to drive the market for investors, but it is the growing resurgence in New South Wales, Victoria and South Australia which is leading to the dream scenario of healthy, growing markets coast-to-coast.
Despite fears about the WA market coming off the boil, investment there continues at near record levels and the average mortgage size broke through the $350,000 barrier last month.
Positive property outlook
Mark Hewitt, General Manager of Sales and Operations said things were looking positive for the property market.
“It is seldom that we see the indicators for every state looking positive, but right now that’s exactly what’s happening," he said.
"The levelling off in interest rates is just what property markets on the east coast need to build up a momentum. Meanwhile the strength of the resources sector continues to support property markets in WA and Queensland."
"We’ve just been doing our internal business forecasts for the next year and AFG is very positive about the year ahead.”
Mortgage size growing
The average home loan nationally now stands at $307,000, with the highest average loans in NSW ($362,000) and WA ($352,000) followed by Queensland (($288,000), Victoria ($277,000) and South Australia ($231,000).
Paradoxically, loan-valuation-ratios (LVRs), which are the value of a loan expressed as a percentage of the value of a property, are lowest in WA (55.4 per cent) and NSW (67.7 per cent), where the cost of housing is highest. Victoria has the highest LVR in the country of 73.0 per cent.
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