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Staff Reporter
The number of new Australian owner occupier mortgages has hit a ten year low in 2010, research from Datamonitor found.
According to the research, 575,000 mortgages for owner occupation were taken out last year, a far cry from the 777,000 mortgages taken out in 2007.
Datamonitor senior analyst Petter Ingemarsson said the drop in mortgages was a result of record low housing affordability driven by higher property prices and higher interest rates.
"Gradually worsening affordability has priced some prospective buyers out of the market, with younger buyers and first time buyers the most affected,” Ingemarsson said.
Since 2000, the average housing lending commitment has more than doubled from $133,000 to $286,000 in 2010, outstripping rises in average incomes.
The widespread expectation of interest rate rises deters some prospective customers, as most economic observers expect at least one 25 basis point rise during this year.
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