Mortgage growth stalls
The data from APRA suggests that rising interest rates are starting to have an impact on the demand for mortgages.
In April, the value of owner-occupied housing loans held by banks and other lenders only grew by 0.3%. This is a significant drop compared to the 1% growth seen in both March and February.
It seems that home buyers are becoming more cautious as interest rates continue to rise.
Despite indications of increased competition in the market, the big four banks still dominate the home loan market for owner-occupiers.
In April, these banks accounted for 83% of all mortgages held by homeowners. Westpac is leading the pack with a 27% share of the market, closely followed by CBA with 25%. ANZ and NAB trail behind with 15.5% each.
The dominance of the big four banks in the home loan market raises concerns about the lack of competition and choice for borrowers. It may be difficult for smaller lenders to compete with the resources and market presence of these major players. This can result in limited options for borrowers and potentially higher interest rates.
However, there are signs that competition is slowly returning to the market. Smaller lenders and non-bank institutions are starting to offer more competitive interest rates and flexible loan products. This is good news for borrowers, as it provides them with more choices and potentially better deals.
It's important for home buyers to shop around and compare different lenders and loan products to find the best option for their needs. This can include considering not just the interest rate, but also the loan features, fees, and customer service. Taking the time to do research and seek professional advice can help borrowers make informed decisions and potentially save money in the long run.
While rising interest rates may be impacting the demand for mortgages, it's important to note that the property market as a whole is still strong.
Demand for housing continues to outstrip supply in many areas, leading to steady price growth. This indicates that while some buyers may be holding back due to higher interest rates, there are still many who are willing and able to enter the property market.