Fewer owner-occupier mortgages were issued than expected in April but the total value of new home loans lifted slightly during the month.
The value of total mortgage lending – excluding refinancing – rose by 0.2 per cent in April to $17 billion, according to seasonally adjusted figures released on Friday by the Australian Bureau of Statistics.
This follows a 3.3 per cent decline in mortgage lending in March.
The number of new loans granted to owner-occupiers for April fell by 1.1 per cent, missing predictions of a flat result, but the value of owner-occupier loans outstripped expectations with a 1.0 per cent jump to $12.6 billion.
The value of new investor loans underwhelmed with a 2.2 per cent drop to $4.4 billion, missing consensus expectations of a one per cent value rise.
The value of both owner occupier and investor loans remains well down on a year ago.
Westpac analysts said the figures were slightly disappointing given the improved tone from auction market activity and an apparent slowing in price declines.
“However, it predates the more material improvement that has occurred since the federal election and the prospective shift that is likely to come following the recent interest rate cut,” Westpac senior economist Matthew Hassan said.
“Auction results and consumer sentiment will be more important guide at the moment, with key updates due in the next week.”
Mr Hassan said construction-related approvals were a notable weak spot in the owner occupier approvals, with a 5.2 per cent drop suggesting there may be more weakness in non high rise building activity coming through.
Total lending to households and businesses was up by 6.1 per cent for April to $67 billion, still 2.7 per cent down on a year ago.
Business lending in April surged by 11.3 per cent to $36 billion and lending for personal finance lifted 4.3 per cent to $4.8 billion.
The value of loans for refinancing dropped by 0.8 per cent to $8.9 billion
The Australian dollar fluctuated in both directions following the release but was steady at 69.75 US cents by 1305 AEST.