Australian buyers return to market

(March 2006)

After a quiet December and January in Australia, property buyers returned to the market in their droves last month, with the country's largest mortgage broker reporting a 27% spike in mortgage sales.

The AFG Mortgage Index shows the company sold 7,121 mortgages, worth over $2 billion across the country in February - a significant 27% increase on January sales.  Positive figures were recorded in all states, with already red-hot WA registering a 14% uplift, Queensland 20%, Victoria 30%, South Australia 36% and New South Wales increasing a massive 50%.

Of more long-term significance, the number of mortgages sold was also 24% higher than in February 2005, with AFG sales in every state outstripping those recorded a year ago.

AFG Mortgage Index also shows that 28% of all new mortgages were sold to property investors, as opposed to owner occupiers.  Property investment continues to peak in Western Australia where just over 38% of all new mortgages are for investment properties.

Turning to mortgage types, while most people opt for basic or standard variable mortgages, the number choosing Fixed interest rate mortgages remains higher than for most of last year, at 17%, suggesting just under a fifth of people are concerned by the prospect of interest rate hikes.

AFG is Australia's largest mortgage broker and has 8.2% of the national market (Source: ABS and AFG statistics).