Posted on Monday, September 02 2013 at 11:31 AM - Property Investor
Property investors are returning to bricks and mortar – and in a big way.
Around 49.5 per cent of home loans processed in New South Wales last month were for investors, according to mortgage broker company Australian Finance Group. This is the highest level of investor activity the company has ever recorded for any state. Other areas around the nation were also strong, with investors comprising of 36.7 per cent of new home loans processed in Victoria, 35.8 per cent in Queensland, 32.9 per cent in South Australia and 28.4 per cent in Western Australia.
General manager of sales and operations Mark Hewitt says $3613 million worth of loans were processed in August, which is higher than the record-breaking figure of $3608 million in May.
“With property prices starting to rise and rates set to remain low for a while yet, a lot of investors are anticipating the next property cycle,” he says.
“The New South Wales figure is very strong, but in part this is because two thirds of first homebuyers exited the market after the withdrawal of buyers’ grants.”
Along with unprecedented levels of investor interest, New South Wales saw the average mortgage size break through the $500,000 barrier for the first time, to $505,000. Fixed home loans are also becoming more popular, with 26.1 per cent of new loans now fixed. This suggests many borrowers are locking in part or all of their loans, in anticipation of the next rate cycle turning, Hewitt says.