Australian Mortgage Demand Plummets as Rates Bite

The Australian mortgage market has experienced a decline in demand for the fourth consecutive month, according to Equifax. The data shows that July's fall in mortgage applications extended across every state and age group, indicating a broad-based slowdown in lending.

The Housing Industry Association (HIA) has warned that the new ban on self-managed super fund (SMSF) borrowing for residential property could substantially cut new-home supply. The HIA is urging the government to allow SMSF borrowing for new homes until the restrictions are independently assessed.

The Reserve Bank of Australia (RBA) has also flagged a 'sharp' recent decline in new housing loan commitments, led by investors retreating amid higher rates, weakening housing conditions, and property-tax changes. The RBA's August Statement on Monetary Policy highlighted the impact of these factors on the market.