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AFG has reported a sharp slowing of mortgage growth and a big drop in first home buyer numbers.
The aggregator sold $4 billion of mortgages in August. That was 9.6 per cent higher than the previous year but much less than the 20 per cent growth of the two previous months.
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AFG said it was unclear whether this slowdown reflected seasonal factors or longer-term concerns over unemployment, global instability and the fall in first home buyer numbers.
Brokers in the AFG network sold 9,087 mortgages in August – up 3.7 per cent on the year.
First home buyers saw their share fall from 11.3 to 9.5 per cent, which was the lowest figure since June 2010.
“The long-term average for first home buyer loans is around 12 to 15 per cent of the total,” AFG said.
“We saw overnight slumps from those levels when NSW and Queensland withdrew first home buyer grants two years ago.
“Since then, property prices – in Sydney in particular – have been steadily increasing. This represents a double-whammy for first home buyers.”
AFG’s average mortgage size in August was $436,000, which was 5.7 per cent higher than the previous year. The average LVR increased from 68.2 to 69.5 per cent.
Borrowers fixed 24.9 per cent of their mortgages, compared to 26.1 per cent the year before.
They opted for big four banks 73.8 per cent of the time – down from 74.9 per cent.
[Related: AFG sets Victorian record]
