Housing-related lending took a breather in December, with the number of loans to owner-occupiers falling by a modest 1.9%. But, by value, loans to investors and owner-occupiers remain on a solid uptrend, especially compared to a year ago, and are 27% higher over the past year.
The background economics to the housing market are still present. Mortgage rates are near record lows, with fixed and variable rates near 6%. Population growth is running at 1.8%pa or 407k. Those people have to live somewhere. By our estimates there has been underbuilding of dwellings in Australia for a considerable period, so there is pent-up demand for housing. Evidence of this demand is found in the above-CPI dwelling rent rises of the past few years in most of the capital cities.
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Commonwealth Bank