(APRA) Australian Prudential Regulation Authority recently released interesting June 2014 quarterly figures for Authorised Deposit Taking Institutions (ADI) – property exposure data. Based on this data it appears that the total value of mortgages to owner occupiers increased 7.5% and 10.9% to investors respectively over the 12 month period to June 2014. Compared to June 2013 quarter it seems owner occupier loans increased 2.0% and investment lending rose 14.4%. Interest only loans indicative of investment loans accounted for 35.7% of all outstanding mortgages. The data also shows that there are proportionally less high risk mortgages being written.
Emerging trends may suggest the high proportion of investment lending on interest only (low interest) loans may cause some concern for the Sydney property markets in particular the inner city unit markets when rates rise and investors exit this asset class causing a drop in values.
Just interpreting statistics – wait and see.