Consumers are returning to the marketplace, with the number of mortgage enquiries at its highest in three years, according to a new report.
Veda’s latest Quarterly Consumer Credit Demand Index has found that mortgage enquiries have increased to 6.9 per cent in the June quarter, rising from 1.9 per cent in the March quarter. This is the latest increase since June 2010.
Overall consumer credit demand increased by 3.9 per cent over the past year but was down from 4.7 per cent in the March quarter.
The volume of mortgage enquiries increased in all the states, with the strongest results in Western Australia ( up 15 per cent), where they continue to strengthen despite a declining mining boom. This was followed by New South Wales ( up 13 per cent), the Northern Territory (up 10.3 per cent) and South Australia (up 7.5 per cent).
Mortgage enquiries remained weak in Victoria (up 1.2 per cent), Queensland (up 1.6 per cent), Tasmania (down 1.3 per cent) and the ACT (down 3.3 per cent).
“Mortgage enquiries are a good indicator of homebuyer demand, with movements in mortgage enquiries tending to lead movements in house prices six to nine months later,” said general manager of consumer risk at Veda Angus Luffman.
“The increase in mortgage enquiries appears to suggest better housing market conditions, a good sign in light of the potential tests facing the Australian economy in the future.
“The fact that the June quarter recorded the largest volume of mortgage enquiries in three years suggests house price growth is likely to remain in positive territory in the near term, for those states and regions experiencing enquiry growth.”