5609.0 - Housing Finance for Owner Occupation, Australia, Oct 2003

ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 10/12/2003

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Main Features
About this Release

OCTOBER KEY FIGURES


	Oct	Sep 2003 to
	2003	Oct 2003
	no.	% change

TREND ESTIMATES

Total number of dwelling commitments	61,490	1.6
Construction of dwellings	5,648	0.2
Purchase of new dwellings	1,724	1.2
Purchase of established dwellings(a)	54,118	1.8

SEASONALLY ADJUSTED ESTIMATES

Total number of dwelling commitments	61,384	-0.3
Construction of dwellings	5,715	1.7
Purchase of new dwellings	1,736	2.7
Purchase of established dwellings(a)	53,933	-0.6

(a) Includes refinancing.

Graph - Housing finance, Number of dwellings

Graph - Number of dwellings, Trend estimates, percentage change

OCTOBER KEY POINTS

TREND ESTIMATES

Growth in the trend series for the number of housing finance commitments eased to 1.6% in October 2003 (down from 2.0%). The trend series excluding refinancing rose by 0.8% (down from 1.1%). The value of commitments trend increased by 2.3% (down from 3.1%).

The construction finance trend series increased of 0.2% in October 2003, while the purchase of new dwellings increased by 1.2%. The established dwellings trend eased to 1.8% in October 2003, while the refinancing trend increased by 3.7%.

SEASONALLY ADJUSTED ESTIMATES

Total housing finance commitments fell by 0.3% in October 2003, the first decline since November 2002, driven by a decrease in the purchase of established dwellings excluding refinancing (down 2.7%). There were increases in refinancing of established dwellings (up 3.3%), purchase of new dwellings (up 2.7%) and construction of dwellings (up 1.7%). A record 30.9% of all finance approvals were for refinancing.

Value of commitments increased by 0.7% in October 2003.

ORIGINAL ESTIMATES

The percentage of commitments at a fixed rate of interest increased to 12.5%. 13.4% of all loans were to first home buyers, which was unchanged from September.

The average loan value was $187,500 in October 2003, down 0.4% after seven months of strong growth. The average loan size for first home buyers was $185,700 in October 2003, down from $187,900 in September 2003, the first fall since February 2003.

NOTES

CHANGES IN THIS ISSUE

From this issue, the concurrent seasonal adjustment methodology has replaced the forward factor approach used up until now. New seasonal factors based on the concurrent adjustment method have been incorporated, resulting in revisions to all seasonally adjusted and trend series.

A note showing the impacts of the change in methodology on the series in this publication is available on the ABS website (www.abs.gov.au - click on AusStats).

New forward factors will be generated each month under the concurrent adjustment method. The new forward factors are available as additional tables on AusStats.

INVESTMENT HOUSING

The value of commitments for the construction or purchase of dwellings for rent or resale is published in the monthly Lending Finance, Australia (cat. no. 5671.0).

SUMMARY OF FINDINGS

DWELLINGS FINANCED

Number financed including refinancing

Total housing finance activity (seasonally adjusted) fell 0.3% (down 214) from last month's series high. This decrease was primarily due to a decrease in finance for the purchase of established dwellings excluding refinancing (down 960, -2.7%). Partially offsetting this fall were increases in refinancing (up 608, 3.3%), construction of dwellings (up 93, 1.7%) and purchase of new dwellings (up 45, 2.7%). The total housing commitments trend increased in October (up 987, 1.6%).

There were decreases (seasonally adjusted) in Queensland (down 193, -1.5%), Victoria (down 123, -0.9%), SA (down 118, 2.3%), Tasmania (down 46, -3.3%) and ACT (down 30, -3.4%), while increases were recorded for NSW (up 112, 0.6%) and WA (up 50, 0.7%), NT remained constant. The trend series increased in October 2003 for all states and territories, except for the Northern Territory.

Graph - Number of dwellings financed including refinancing

The percentage of fixed rate commitments (for two years or more) increased for the fourth successive month to 12.5%, in an environment where increases in the official interest rate have been anticipated.

Number financed excluding refinancing

The number of dwellings financed excluding refinancing (seasonally adjusted) decreased in October 2003 (down 822, -1.9%), following rises in nine of the last ten months. The trend series increased by 0.8% in October.

Graph - Number of dwellings financed excluding refinancing

Value of commitments

The total value of commitments (seasonally adjusted) increased by 0.7% in October 2003. The trend series continued its run of increases since September 2000, with the October 2003 increase of 2.2% influenced by the strength in the seasonally adjusted series in previous months.

PURPOSE OF FINANCE

Construction of dwellings

Construction commitments (seasonally adjusted) rose by 1.7% in October 2003. The trend series increased by 0.2% in October, continuing the run of small increases evident so far in 2003.

Purchase of new dwellings

The number of finance commitments for the purchase of new dwellings (seasonally adjusted) rose by 2.7% in October 2003, after an increase of 1.6% in September. The trend series rose 1.2% in October, following larger increases over the previous twelve months.

Purchase of established dwellings

The seasonally adjusted established dwelling finance series decreased by 0.6% (down 352) in October 2003, after rises each month since December 2002. The decrease was despite a large increase (up 608) in refinancing. When refinancing is excluded, the series fell by 2.7%. The trend series growth slowed to 1.8% in October.

Refinancing

The number of refinancing commitments (seasonally adjusted) rose by 3.3% in October 2003, making October the sixth consecutive month of growth. As a result, trend growth remained strong, at 3.7%.

TYPE OF LENDER

Banks

The seasonally adjusted bank series increased by 0.8% in October 2003, following larger increases in the previous five months. Growth in the trend series eased slightly to 1.7%.

Non-banks

After ten months of growth in seasonally adjusted terms, non-bank lending commitments decreased by 3.5% (seasonally adjusted) in October 2003. There were
seasonally adjusted decreases recorded for permanent building societies (down 2.6%) and wholesale lenders (down 1.0%). The non-bank trend series continued to increase in October, but at the slower rate of 1.4%.

FURTHER INFORMATION

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