5609.0 - Housing Finance, Australia, May 2009 Quality Declaration 
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 08/07/2009   
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The Australian Bureau of Statistics (ABS) produces Housing Finance from two main sources. The majority of data are sourced from the Australian Prudential Regulatory Authority (APRA), while the ABS collects data for lenders that are not required to report to APRA. Final quality assurance and analysis of all data is conducted by the ABS.

For more information about the institutional environment of the ABS, including the legislative obligations of the ABS, financing and governance arrangements and mechanisms for scrutiny of ABS operations, see ABS Institutional Environment.

APRA is the independent statutory authority for the prudential regulation of the Australian financial services industry. The authority for APRA to collect data is granted under The Financial Sector (Collection of Data) Act 2001, which established APRA as the national statistical agency for the Australian financial sector. For more information about the roles and responsibilities of the organisation, see the APRA website.

Housing Finance presents statistics for new commitments for the reference month by significant lenders for financing residential dwellings in Australia. It includes:
  • secured finance commitments for the construction, purchase, refinancing or alterations of owner occupied dwellings; and
  • secured and unsecured finance commitments for the construction, purchase or refinancing of dwellings for rent or resale (investment housing).

These commitments are classified by:
  • State and Territory;
  • banks and non-banks, including building societies and wholesale lenders; and
  • first home buyers and fixed rate loans.

Housing Finance also presents the outstanding value of housing loan assets to individuals held by lenders at the end of each reference month.

It is important to note the distinction between a financing commitment and actual financing activity. Housing finance commitments are not a direct measure of financing, sales or construction in the residential dwelling market. A commitment exists once the home loan application has been approved, and a loan contract or letter of offer has been issued to the borrower. A commitment to lend will therefore exist only after the property has been found and valued and mortgage insurance arranged (where relevant). The actual advancement of funds may not occur in the same month or necessarily at all. This data is contained in Table 8: Housing Finance Commitments (Owner Occupation), By Purpose and Change in Stock.

Housing Finance is released monthly, 28 working days after the end of the reference month.

All tables in Housing Finance, except table 12, contain data from lenders' monthly reporting of new finance commitments to either APRA or the ABS. Table 12 (Housing Loans Outstanding to Households) contains data from both monthly and quarterly statements of financial position submitted to either APRA or the ABS. The quarterly data are published in the month following the quarterly reference period.

Housing Finance has no sampling error since it attempts to enumerate all providers in scope and does not select providers to be in sample. Housing Finance also has low non-response rates. As with all surveys, Housing Finance does have non-sampling error arising from inaccuracies in collection, recording and processing. Every effort is made to minimise non-sampling errors by the careful design of questionnaires, contact with providers and efficient data processing procedures.

Financial institutions subject to prudential regulation are obliged to report information to APRA directly. Data for these institutions are then provided to the ABS for inclusion in Housing Finance. Data for other lenders, such as wholesale lenders, are directly collected by the ABS. These sources cover all banks and permanent building societies, as well as other lenders providing aggregate housing finance funds of more than $50m ("Significant" lenders). Additional smaller lenders are included to maintain collection coverage. These criteria ensure the coverage includes at least:
  • 95% of total Australian finance commitments;
  • 90% of each state and territory total commitments; and
  • 70% of finance commitments by wholesale lenders.

There have been few changes in the forms and reporting requirements since the commencement of Housing Finance in 1975. Between 2001 and 2003, the ABS passed the responsibility of data collection for regulated institutions to APRA, leading to only a small portion of data still collected directly by the ABS. During this transition, care was taken to ensure there were no interruptions to time series. APRA and ABS questionnaires are similarly worded to ensure consistency in data. This is discussed in detail in the Explanatory Notes.

Occasionally a financial institution may change its institution type, for example, from a building society to a bank. The reclassification caused by such a change is reflected in the month it occurs, and earlier periods are not revised. Details of the establishment of new banks are published in the Reserve Bank Bulletin Technical Notes to Tables.

Statistics are generally provided in trend, seasonally adjusted and original terms. The trend series smooths out the volatility in the data including removing seasonal effects (such as the number of trading days and moving holidays), and is therefore considered the best indicator of underlying movements. The seasonally adjusted series removes the seasonal effects but does not smooth out the volatility in the data. The original series neither removes the seasonal effects nor smooths out the volatility in the data.

Both seasonal and trend estimates, by their nature, are subject to revisions over time. In most instances, the larger revisions will be to the previous month and the same month a year ago. The possible effects of trend revisions to Housing Finance are examined in What If...? Revisions to Trend Estimates. For more information regarding seasonal adjustment and trend series, refer to the Explanatory Notes, or Time Series Analysis Frequently Asked Questions.

The ABS produces many publications that complement Housing Finance, some of which are listed in the Explanatory Notes. There are additional tables regarding housing finance available in the Downloads tab of this publication. Enquiries can be made to the contact on the front page of the publication or The National Information and Referral Service.

Alternative data sources include the APRA Statistics website and the Reserve Bank of Australia's Bulletin. They include a large number of tables of financial statistics, mostly sourced from the ABS and APRA.