Mortgage lending activity was solid in April despite Easter/ANZAC being close together and many people taking an extended holiday, property information company CoreLogic says.
Even so, it says, the banks in aggregate are still operating well below the LVR speed limits, and interest-only lending to investors is contained too.
"Over the next few months, there has to be a decent chance that the scrapping of the capital gains tax proposals and the cut in the official cash rate will provide a further boost to activity in the mortgage market."
CoreLogic economist Kelvin Davidson says the latest Reserve Bank figures showed that mortgate lending in April was $5.45 billion, up by about $80 million from the figure of $5.38 million a year ago.
"Lending to owner-occupiers rebounded a bit in April (after a soft March), but investor lending continues to edge down on a year-on-year basis," he says.
"As part of the rise in owner-occupier lending, high loan to value ratio (LVR) lending to first home buyers (FHBs) continues to grow, albeit there’s been an inevitable slowdown from the previously very rapid rates."
Mr Davidson says that once again, the number of loans approved across all borrowers was relatively flat, so the growth in lending in April was driven by larger average loan sizes.
"Meanwhile, the LVR speed limits are still not being tested by the banks (at least in aggregate). The proportion of lending to owner-occupiers in April with an LVR >80% was only 12.6%, well below the 20% cap. Note that it’ll be July before we get the first figures on investor lending at the new, lower 30% deposit requirement (still a 5% speed limit)."