As borrowers respond to better deals, refinancing will drive mortgage growth JPMorgan says... Conditions mixed across Queensland as Brisbane hits a record...
Refinancing to drive Australian mortgage growth, JPMorgan says
(Bloomberg) -- Refinancing will drive Australian mortgage growth in 2016 as borrowers gun for better deals after lenders raised interest rates for the first time in five years and the run-up in home values allows them to increase the size of their loans, a mortgage report by JPMorgan Chase & Co. said.
The number of borrowers looking to refinance has increased to almost 35 percent from 10 percent in early 2015 as they seek better terms, the report in collaboration with research firm Digital Finance Analytics said Wednesday.
Australian mortgages has been the fastest growing segment for the nation’s lenders as surging home prices bolstered demand. However, regulatory pressure has forced banks to tighten lending, resulting in growth slipping for two consecutive months.
“The major banks will need to capture the re-financing tailwind by targeting the right customers through the right channels,” JPMorgan banking analyst Scott Manning said.
He expects housing credit growth to moderate back to the mid single digits post 2016 as the refinancing momentum stalls. Australian mortgage growth slipped to a six-month low of 7.3 percent in January, according to data from the Reserve Bank of Australia.
Conditions mixed across Queensland as Brisbane hits a record
According to the REIQ, the December quarter saw house prices in the Brisbane Local Government (LGA) Area hit a median price of $632,000, a new record for the LGA, after rising by 1.6%.
That increase makes it 14 straight quarters where the median house price in the LGA has increased and means it is 6.1% higher than during the December 2014 quarter and 14.2% higher than at the same time in2010.
REIQ chief executive officer Antonia Mercorella said Brisbane’s streak of price improvements showed the city is in the midst of a sustainable period of growth.
“Our market has avoided the pitfalls of a boom and bust cycle, performing consistently over the past 14 quarters, which is more than three years of sustained growth,” Mercorella said.
“I know some property owners in Sydney and Melbourne who envy that record,” she said.
(Bloomberg) -- Refinancing will drive Australian mortgage growth in 2016 as borrowers gun for better deals after lenders raised interest rates for the first time in five years and the run-up in home values allows them to increase the size of their loans, a mortgage report by JPMorgan Chase & Co. said.
The number of borrowers looking to refinance has increased to almost 35 percent from 10 percent in early 2015 as they seek better terms, the report in collaboration with research firm Digital Finance Analytics said Wednesday.
Australian mortgages has been the fastest growing segment for the nation’s lenders as surging home prices bolstered demand. However, regulatory pressure has forced banks to tighten lending, resulting in growth slipping for two consecutive months.
“The major banks will need to capture the re-financing tailwind by targeting the right customers through the right channels,” JPMorgan banking analyst Scott Manning said.
He expects housing credit growth to moderate back to the mid single digits post 2016 as the refinancing momentum stalls. Australian mortgage growth slipped to a six-month low of 7.3 percent in January, according to data from the Reserve Bank of Australia.
Conditions mixed across Queensland as Brisbane hits a record
According to the REIQ, the December quarter saw house prices in the Brisbane Local Government (LGA) Area hit a median price of $632,000, a new record for the LGA, after rising by 1.6%.
That increase makes it 14 straight quarters where the median house price in the LGA has increased and means it is 6.1% higher than during the December 2014 quarter and 14.2% higher than at the same time in2010.
REIQ chief executive officer Antonia Mercorella said Brisbane’s streak of price improvements showed the city is in the midst of a sustainable period of growth.
“Our market has avoided the pitfalls of a boom and bust cycle, performing consistently over the past 14 quarters, which is more than three years of sustained growth,” Mercorella said.
“I know some property owners in Sydney and Melbourne who envy that record,” she said.
