Australian Property News

Mortgage sizes hit a high

Posted on Wednesday, December 02 2009 at 4:22 PM

Mortgages sizes have reached a record high in Australia, hitting $367,000 in November, according to a mortgage broker.

The AFG Mortgage Index shows that the average new mortgage size has been on the rise since the middle of the year, increasing by 6.4 per cent since May.

Average mortgage sizes have grown very strongly in Victoria, up by 12.1 per cent since May, followed by New South Wales where mortgages grew by 10.7 per cent.

In Western Australia mortgages rose by three per cent and they remained steady in Queensland.

While overall monthly sales of mortgages in November declined for the second month in a row, AFG data showed that November was the busiest month for property investors.

They accounted for more than 33 per cent of all new mortgages which was the highest figure all year, well up on the 24.7 per cent figure for March when investment reached its lowest point.

First homebuyers accounted for only 13.7 per cent of all mortgages arranged in November, compared to 28.1 per cent at their peak in March.

AFG general manager of sales and operations Mark Hewitt says confidence is still fragile, despite larger average mortgages and greater investor activity.

"October and November are seasonally strong months in the calendar, but we've seen two straight months of decline," he says.

"In our view the RBA has gone too far too fast in ratcheting rates back up again."

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