Mortgage crash signals more sharp house price falls By Unconventional Economist in Australian Property March 13, 2019 - By Leith van Onselen
Yesterday’s Lending to households and businesses release from the ABS revealed that total mortgage lending (excluding refinancings) tanked by 19.2% in the year to January 2019 in trend terms, driven by an epic 27.7% crash in investor commitments, whereas owner-occupied commitments also fell by 15.4%..
As shown above, annual investor mortgage growth is a whisker above the GFC low, which was quickly followed by a sharp V-shaped recovery.As regular readers of MB will know, we consider the flow of housing and investor finance commitments to be the premier indicators for dwelling value growth. This view is based on the incredibly strong historical correlation between finance and prices, as illustrated by the next charts..
..Until housing finance turns and begins to rise, Australian housing will crash.
