Australian borrowers took out a record number of home loans in June, with investors cramming to get back into the market despite the recent interest rate hikes.
Home loans to owner-occupiers rose by 1.3% to a record 63,623 in June according to the latest data from the Australian Bureau of Statistics.
The strong gain beats market expectations of a 1% rise and further justifies the recent move by the Reserve Bank of Australia to increase interest rates a second time to 6%.
Investor lending jumped by 4.5% to $6.5bn worth of loans, thanks to the solid rise in the number of housing purchased for rent or resale by individuals. The proportion of loans to investors grew to 39% in the month of June.
"Over the last two months, investors have been returning to the housing market in greater numbers. While the levels are still below the peak of 48%, low vacancy rates in all capital cities should see rental growth accelerate. This should further encourage investors back into the housing market," said Commonwealth Bank's Joseph Capurso.
However, the increased investors' interest in housing could spell doom for new homebuyers trying to break into the property market. Already, the proportion of all loans taken by first homebuyers dropped to 17% in June to its lowest level in 11 months.