Investor mortgage lending waning

CoreLogic says it is interesting as the Reserve Bank has declined to look at any restrictions on this type of lending.

“One implication could be investor demand for property has eased, perhaps as they react to the phased removal of interest deductibility and instead raise their equity levels as quickly as possible by repaying some mortgage principal,” says Kelvin Davidson, CoreLogic’s chief economist.

Reserve Bank figures show mortgage lending last month was $8.5 billion about $3.2 billion higher than a year ago.

“One interesting aspect of the split by LVR/borrower type is that first home buyers basically have a monopoly on the money being lent out with less than a 20% deposit,” says Davidson.