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Property investors are most active in Victoria, mortgage sales from one of the nation’s largest mortgage broking groups have revealed.
Investors accounted for 38.4 per cent of all new home loans processed in Victoria during the month of April, AFG’s monthly mortgage report showed this week, making it the most popular investment market.
New South Wales wasn’t far behind with 37.5 per cent of new home loans written for investors.
New South Wales was also the most popular state with first home buyers, with 17.3 per cent of all mortgages processed in the state processed for first timers – well above the national average of 13.9 per cent.
Overall, national mortgage sales fell almost 10 per cent in April, year on year, according to AFG.
The mortgage group processed $2.1 billion in mortgages in April 2011, compared to $2.3 billion in April 2010.
Month on month figures showed an even larger fall of 15.6 per cent - but this drop in volume also reflected the impact of the extended Easter and Anzac public holidays.
AFG general manager of sales and operations Mark Hewitt said falling property prices, rising interest rates, the increasing cost of living and the fear of a carbon tax were a toxic combination to consumer confidence.
“As people start to see their net worth eroding because of falling home and investment property values, they become even less likely to spend. The government needs to address this problem in its forthcoming budget, and provide a circuit breaker to restore confidence among consumers that the underlying fundamentals of our economy are still strong,” he said.