Strong demand in April results in home loan increase... Australia among top countries in debt... Housing boom boosting retail sector...
April strong month for home loans
The number of home loans issued in April rose unexpectedly, driven by stronger demand for mortgages among both investors and prospective owner-occupiers, according to an article from Market Watch.
Lending to home buyers climbed by one per cent from March, government data showed Tuesday, supported by record-low interest rates that propelled a 2.6 per cent rise in the value of loans to property investors. The news comes as this was the third month in a row that the number of home loans has risen.
Investor lending for housing is under the microscope of policy makers. The Treasury last week warned that a price "bubble" exists in Sydney, while Australia's banking regulator has moved to curb lending to investors, to whom about half of all mortgages are currently being sold.
Economists surveyed ahead of the announcement expected a 2.0 per cent fall in the number of home loans issued.
Australia among top countries in debt
Australia’s households are the third most indebted in the world, relative to GDP, after having passed the Netherlands in 2014. Aussies are now closing in on the leader of the pack, Denmark, and second place, Switzerland, according to an article from Business Insider.
“Given the current boom in Sydney and Melbourne, it is possible Australia will soon exceed Switzerland to become 2nd, and with enough time, perhaps 1st,” write Lindsay David and Philip Soos in a new report by LF Economics.
By the end of 2014, Australia’s unconsolidated household-debt-to-GDP ratio reached 118 per cent. But it’s not because Aussies ran up their credit cards.
Personal debt (credit cards, auto loans, and personal loans), after soaring in spurts and starts from five per cent of GDP in 1976 to 13 per cent of GDP in 2007, has since plunged back to just over eight per cent GDP, the lowest since the mid-1990s. What they did run up was mortgage debt. It funded, as the report puts it, “the largest housing bubble on record.”
Housing boom boosting retail sector
The housing boom in Melbourne and Sydney, and low interest rates have given a much-needed boost to the homemaker and bulky goods retail sectors. Colliers head of retail Michael Bate said low interest rates and the strong housing market meant people "are investing more in their castles", according to an article from the Sydney Morning Herald.
"This is great news for the large-format retail sector where hardware, garden supplies, electrical goods and furniture are all back in vogue," Mr Bate said.
Research from JLL shows the increased spending and lower vacancy rates are starting to lift rents in the sector, which have languished since the global financial crisis. JLL's associate director of strategic research, Andrew Quillfeldt​said the bulky goods market had been stimulated by strong residential construction activity and the subsequent rebound in spending on household goods.
"The April figures released by the Australian Bureau of Statistics show spending on household goods continues to strengthen, up 8.2 per cent year on year, nationally, with New South Wales and Victoria the major drivers, with growth of 13.8 per cent and 8.5 per cent respectively."
The number of home loans issued in April rose unexpectedly, driven by stronger demand for mortgages among both investors and prospective owner-occupiers, according to an article from Market Watch.
Lending to home buyers climbed by one per cent from March, government data showed Tuesday, supported by record-low interest rates that propelled a 2.6 per cent rise in the value of loans to property investors. The news comes as this was the third month in a row that the number of home loans has risen.
Investor lending for housing is under the microscope of policy makers. The Treasury last week warned that a price "bubble" exists in Sydney, while Australia's banking regulator has moved to curb lending to investors, to whom about half of all mortgages are currently being sold.
Economists surveyed ahead of the announcement expected a 2.0 per cent fall in the number of home loans issued.
Australia among top countries in debt
Australia’s households are the third most indebted in the world, relative to GDP, after having passed the Netherlands in 2014. Aussies are now closing in on the leader of the pack, Denmark, and second place, Switzerland, according to an article from Business Insider.
“Given the current boom in Sydney and Melbourne, it is possible Australia will soon exceed Switzerland to become 2nd, and with enough time, perhaps 1st,” write Lindsay David and Philip Soos in a new report by LF Economics.
By the end of 2014, Australia’s unconsolidated household-debt-to-GDP ratio reached 118 per cent. But it’s not because Aussies ran up their credit cards.
Personal debt (credit cards, auto loans, and personal loans), after soaring in spurts and starts from five per cent of GDP in 1976 to 13 per cent of GDP in 2007, has since plunged back to just over eight per cent GDP, the lowest since the mid-1990s. What they did run up was mortgage debt. It funded, as the report puts it, “the largest housing bubble on record.”
Housing boom boosting retail sector
The housing boom in Melbourne and Sydney, and low interest rates have given a much-needed boost to the homemaker and bulky goods retail sectors. Colliers head of retail Michael Bate said low interest rates and the strong housing market meant people "are investing more in their castles", according to an article from the Sydney Morning Herald.
"This is great news for the large-format retail sector where hardware, garden supplies, electrical goods and furniture are all back in vogue," Mr Bate said.
Research from JLL shows the increased spending and lower vacancy rates are starting to lift rents in the sector, which have languished since the global financial crisis. JLL's associate director of strategic research, Andrew Quillfeldt​said the bulky goods market had been stimulated by strong residential construction activity and the subsequent rebound in spending on household goods.
"The April figures released by the Australian Bureau of Statistics show spending on household goods continues to strengthen, up 8.2 per cent year on year, nationally, with New South Wales and Victoria the major drivers, with growth of 13.8 per cent and 8.5 per cent respectively."
