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5609.0 - Housing Finance, Australia, May 2004  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 09/07/2004   
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MAY KEY FIGURES

Trend estimates
Seasonally adjusted estimates
May 2004
Apr 2004 to May 2004
May 2004
Apr 2004 to May 2004

Value of dwelling commitments(a)
$m
% change
$m
% change
Total dwellings
15,338
-0.2
15,531
-1.5
Owner occupied housing
9,721
0.2
9,851
-1.2
Investment housing - fixed loans(b)
5,617
-1.0
5,680
-2.0
Number of dwelling commitments(a)
no.
% change
no.
% change
Owner occupied housing
48,419
-1.2
48,625
-2.6
Construction of dwellings
5,206
0.1
5,201
-2.9
Purchase of new dwellings
1,730
-0.3
1,747
-5.3
Purchase of established dwellings
41,483
-1.4
41,677
-2.5

(a) Includes refinancing.
(b) Excludes revolving credit.

Housing finance, Value of dwellings
Graph: TABLE 8. Finance Commitments for Housing: Original, Seasonally Adjusted and Trend ($'000)

Owner occupied housing finance, Number of dwellings
Graph: Owner occupied housing finance



MAY KEY POINTS


TREND ESTIMATES

  • Total value of dwelling finance commitments decreased slightly by 0.2% in May 2004, the eighth consecutive monthly decrease. Owner occupied housing rose slightly (up 0.2%) after seven consecutive monthly falls, while investment housing decreased (down 1.0%) for the eighth consecutive month.
  • The number of housing finance commitments for owner occupation declined by 1.2% in May 2004, while the number excluding refinancing declined by 0.2%.


SEASONALLY ADJUSTED ESTIMATES
  • Total value of housing finance commitments fell by 1.5% in May 2004, following small increases in the previous three months. This fall was due to decreases in both investment housing commitments (down 2.0%) and owner occupied housing commitments (down 1.2%).
  • The number of housing finance commitments for owner occupied housing decreased by 2.6% in May 2004, following an increase of 0.3% in April 2004. The number excluding refinancing declined by 1.9%.


ORIGINAL ESTIMATES
  • The percentage of first home buyer commitments increased for the second consecutive month after the record low in March 2004, increasing to 14.1% in May 2004.


NOTES

CHANGES IN THIS ISSUE

There has been a significant reclassification of housing finance commitments to investment housing from owner occupied housing for all bank and total lender series in most States and Territories for the period August 2003 to March 2004. Revisions put through for August 2003 to February 2004 for the number and value of owner occupied housing commitments by purpose and type of loan have been imputed by the ABS based on aggregate estimates by State provided by the reporting banks, with these estimates expected to be replaced by final values in the July 2004 issue. Revisions for the March 2004 reference month do not contain imputations.



INQUIRIES

For further information about these and related statistics, contact the National Information and Referral Service on 1300 135 070 or Darren Page on Canberra (02) 6252 6731.



SUMMARY COMMENTARY


HOUSING FINANCE SUMMARY OF FINDINGS


DWELLINGS FINANCED

Value of Dwelling Finance

The total value of dwelling commitments excluding alterations and additions (seasonally adjusted) decreased by 1.5% in May 2004, following small increases in the previous three months. The total housing finance trend fell by 0.2% in May 2004, the eighth consecutive monthly decrease.


The total value of owner occupied commitments (seasonally adjusted) fell by 1.2% in May 2004, following slight increases in the previous three months. Decreases in purchase of new dwellings (down 5.9%) and established dwellings excluding refinancing (down 1.9%) were offset partially by increases in refinancing of established dwellings (up 0.6%) and construction of dwellings (up 0.5%). The trend series increased by 0.2% in May.


The seasonally adjusted series for value of investment housing commitments (including finance for construction and finance for rent or resale) decreased by 2.0% in May 2004, following a revised decrease of 2.4% in April. The decrease this month was primarily due to a large decrease in finance for the purchase of dwellings for rent or resale by individuals (down 4.4%). Partially offsetting this fall were increases in construction of dwellings for rent or resale (up 22.4%) and purchase of dwellings for rent or resale by others (up 1.5%). The trend series fell by 1.0%.

INVESTMENT HOUSING - TOTAL
Graph: INVESTMENT HOUSING - TOTAL



Number of Owner Occupied Dwellings Financed

The number of owner occupied dwelling commitments (seasonally adjusted) decreased by 2.6% in May 2004 after a revised 0.3% increase in April. The decrease was mainly due to the refinancing of established dwellings (down 649, -4.4%) and purchase of established dwellings excluding refinancing (down 417, -1.5%). There were also decreases in construction of dwellings (down 157, -2.9%) and purchase of new dwellings (down 97, -5.3%).


The total owner occupied housing finance trend fell by 1.2% in May 2004, continuing its decline since September 2003 but at a decelerating rate for the fourth successive month.


Decreases were recorded in seasonally adjusted terms in WA (down 524, -7.6%), Victoria (down 508, -4.5%), Queensland (down 447, -4.4%), SA (down 226, -5.2%), Tasmania (down 67, -5.9%), NT (down 20, -4.7%) and ACT (down 6, -1.0%). The national decline was relatively smaller than the large decreases in most of these states and territories due to a significant increase in NSW (up 292, 2.0%). The trend rate of decline has decreased in all states and territories except Tasmania and NT.


In original terms, the average loan size for owner occupied housing commitments grew for the fourth successive month, increasing by $2 200 to $204 000 in May 2004. First home buyer commitments as a percentage of total owner occupied housing commitments increased to 14.1% in May 2004, the second consecutive monthly increase since the record low of 12.8% in March 2004.

Graph: Housing Finance - Dwellings Financed - Number of Owner Occupied Dwellings Financed


Number of Owner Occupied Dwellings Financed Excluding Refinancing

The number of owner occupied dwellings financed excluding refinancing (seasonally adjusted) fell by 1.9% in May 2004, after small increases in the previous three months. The trend fell 0.2% in May 2004, its ninth consecutive monthly decline but at a decelerating rate for the fourth successive month.

Graph: Housing Finance - Dwellings Financed - Number of Owner Occupied Dwellings Financed Excluding Refinancing



PURPOSE OF FINANCE (OWNER OCCUPATION)

Construction of dwellings

The seasonally adjusted number of construction commitments for owner occupation fell by 2.9% in May 2004, after an increase of 4.4% in April. The trend increased slightly (up 0.1%) in May 2004, following eight consecutive decreases.

Graph: Housing Finance - PURPOSE OF FINANCE - Construction of dwellings


Purchase of new dwellings

The number of finance commitments for the purchase of new dwellings for owner occupation (seasonally adjusted) fell by 5.3% in May 2004, after an increase of 7.1% in April 2004. The trend series fell 0.3% in May, the sixth consecutive month of trend decline.

Graph: Housing Finance - PURPOSE OF FINANCE - Purchase of new dwellings


Purchase of established dwellings

The seasonally adjusted established dwelling for owner occupation series decreased by 2.5% in May 2004, the eighth consecutive month since the last increase. The trend fell 1.4% in May 2004, continuing its decline since September 2003 but at a decelerating rate for the fourth successive month.

Graph: Housing Finance - PURPOSE OF FINANCE - Purchase of established dwellings


Refinancing

The number of refinancing commitments for owner occupied housing (seasonally adjusted) fell by 4.4% in May 2004, the fifth successive month of decreasing commitments. The trend series decreased by 3.6% in May.

Graph: Housing Finance - PURPOSE OF FINANCE - Refinancing



TYPE OF LENDER (OWNER OCCUPATION)

Banks

Bank finance for owner occupied housing (seasonally adjusted) decreased for the seventh time in eight months, falling by 2.3% (down 868) in May 2004 after an increase of 1.4% in April. The trend series fell 0.8% in May.

Graph: Housing Finance - TYPE OF LENDER - Banks


Non-banks

Non-bank commitments for owner occupied housing (seasonally adjusted) decreased for the eighth consecutive month in May 2004, falling by 3.7%. This decrease was primarily driven by the seasonally adjusted decrease for wholesale lenders (-6.0%) while permanent building society activity was up 7.7%. The non-bank trend series fell by 2.5% in May 2004.

Graph: Housing Finance - TYPE OF LENDER - Non-banks


HOUSING LOAN OUTSTANDINGS

At the end of May 2004, housing loans outstanding of authorised deposit-taking institutions was $463 714m, up $7 363m (1.6%) from April's closing balance. Owner occupied housing loans increased by $4 604m (1.5%) to close at $309 525m, while investment housing loans outstanding increased by $2 759m (1.8%) to reach a closing balance of $154 189m.


Bank loans increased by $7 086m (1.7%) during May to a closing stock of $435 895m. Owner occupied housing loans increased by $4 406m (1.6%) to $287 050m, while investment housing loans increased $2 680m (1.8%) to $148 845m.


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