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Matthew Hassan, Research Analyst at Westpac, points out that Australian housing finance approvals continued to soften in September as the headline number of owner occupier loans declined 1% in line with the consensus forecast.

Key Quotes

“Ex refinancing, the decline was a milder 0.5%mth.”

“The value of loans was considerably weaker. In particular the value of owner occupier loans dropped 4.2%mth to be down 8% in the space of two months. With the number of approvals showing much milder declines, the implied average loan size has declined notably, by 3.6% since May, or $14.6k.”

“The combined total value of housing finance approvals including investors but excluding owner occupier refi, fell 3.7% to be down 14.2%yr.”

“Overall, the finance data shows continued soft conditions, particularly across the owner occupier segment where tighter lending standards look to now be the main source of weakness.”