Queensland first home buyer and investor numbers fall

Queensland first home buyer numbers have fallen sharply but underlying levels remain solid compared to other housing market activity.

Latest ABS data reports that 1529 first home buyer loans were approved over August, which was a reduction of 8.3 per cent over the 1667 approved over July. The August total was the lowest since May and also 6.5 per cent below the 1636 approved over August last year.

A total of 12,243 first home buyer loans have been approved over the first eight months of this year in Queensland compared to 11,764 over the same period last year. This is an increase of 479 or 4.1 per cent.

The average Queensland first home buyer loan increased marginally by 0.8 per cent over August to $297,200 and is now 4.5 per cent higher than the $284,400 average first home buyer loan recorded over August last year.

Lending to first home buyers in Queensland accounted for 11.0 per cent of all residential lending excluding home loan refinancing over August. This was an increase over the 10.7 per cent market share recorded over July but continues to track below the long term average 15.6 per cent.

Queensland also recorded a sharp fall in investor lending over August with the value of loans approved to this group down from $2.1 billion to $1.7 billion, a decrease of 16.8 per cent.  The value of investor lending in Queensland over the first eight months of this year however remains 21.4 per cent higher than that recorded over the same period in 2014.

Investor activity over August accounted for 42.2 per cent of all residential lending over the month, which is the lowest market share recorded since November 2014.

All states again recorded sharp decreases in investor lending over the month following similar declines the previous month. Action by banks to increase interest rates to investors at the direction of the regulatory authorities is clearly having an impact on investor activity nationally.

The ABS reported that the value of finance approved in Queensland for owner occupier dwellings excluding refinancing was also down over August, falling by 4.5 per cent to $2.4 billion.

The value of finance approved for total dwellings excluding refinancing in Queensland fell by 10.2 per cent over the month to $4.1 billion, the lowest result recorded since April. Home lending over the first eight months of this year however remains 11.4 per cent higher than the value financed over the same period last year.

Dr Andrew Wilson is Domain Group Senior Economist Twitter@DocAndrewWilson