AFG Mortgage Index – September Quarter 2015

Australian Finance Group (ASX: AFG) Mortgage Index has today reported the total value of home loans processed by AFG brokers for the September 2015 quarter was $14.161B, an increase of nearly 16% on the same period last year.

Brett McKeon, AFG Managing Director outlined the result: “A key driver of the strong result was activity from upgraders – owner occupiers changing properties. In the June quarter 28% of the loans we processed were for homeowners making a move but this lifted to 34% for the September quarter. This activity is consistent with the traditional spring buying season which is now well underway.

“With continued low interest rates and lender policy changes being made around investment and interest only lending, many borrowers are aware the market is changing and are seeking the help of an informed, professional broker.

A shift in requirements for lenders set down by APRA however is having an impact on total flows with investment lending for the quarter down from a 3 year average of 38% of total loans processed, to 33%.

“We have noticed in the latter part of the quarter that the percentage of our business comprised of investment lending stabilized at 32 – 33% so it appears that the last round of changes have now flowed through the system” Mr McKeon said.

With interest rates low and some commentators predicting there may be further falls, fixed home loans were at their lowest level for more than three years at 11.3% of total loans processed for the quarter.

The pricing and policy changes made by the majors saw the non-majors regain 2 % in market share in the investor space over the quarter, a further indication that borrowers are seeking a broker’s help.