Readers will recall my comments about de facto rate cuts in recent times. From AFG today:
"August mortgage sales surged to their highest volume in over eighteen months according to AFG, Australia’s largest mortgage broker. AFG processed over $2.7 billion of mortgages in August – the highest volume figure since March 2010. Refinancing accounted for 38.2% of all mortgages as property owners took advantage of a highly competitive lending environment. While August figures are typically stronger than previous months, these figures trend well above seasonal expectations. There was a sharp increase in fixed rate home loans as lenders heavily discounted their rates. Fixed home loans comprised 9.4% of all loans processed compared to 7.9% in July - the highest level since December 2010. Mark Hewitt, General Manager of Sales and Operations says: ‘Borrower expectations about interest rates shifted significantly during August. We’re seeing a lot of refinancing as borrowers take advantage of discounted products. But we’d like to see lenders create more flexible and competitive products for the new home building sector. It isn’t just consumer confidence that is holding back this sector, it is also the availability of attractive finance options.’ Along with refinancing, investment is the strongest sector of the market. New South Wales led the nation with 40.8% of all new home loans for investment purposes. This compares with 38.1% in Victoria, 34.4% in Queensland, 33.5% in South Australia and 33.4% in WA."
