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Is “RentVest” causing a spike in loan amounts?

by xyonent
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Australian House Property Front Spi I25el7.jpg

Soaring house prices and a decline in rental housing have boosted the value of new mortgages, according to the Real Estate Institute of Australia (REIA).

Looking back at these survey results, Australian Bureau of Statistics According to data from the Australian Real Estate Investment Association (ABS), Real Estate Investment Association (REIA) president Leanne Pilkington said: “Rentvestment, where individuals rent a property to live in and invest in other properties at the same time, is on the rise, particularly in regional areas. This reflects changing preferences and economic trends in the housing market.”

This thinking is reflected in the ABS’s findings that the value of new mortgages has risen 17.9% since March 2023 to $27.6 billion, with a 3.1% increase in March 2024 alone.

According to these statistics, homeowner loans increased 2.1% in March 2024 to reach $12.3 billion in new value, up 8.8% from March 2023.

Loans to first-time homebuyers are also observed to have increased 4.4% in March 2024 to $5.2 billion, up 17.9% from March 2023.

Investor loans have seen the biggest year-over-year increase in value, increasing 31.1% since March 2023 to a current valuation of $10.2 billion.

Analysing these findings, the ABS noted that the value of these new lending commitments is directly attributable to both the size and volume of the loans being approved.

The agency also noted that these findings are consistent with the historically low vacancy rates observed throughout last year.

However, Mr Pilkington said housing affordability remained a challenge, and the “data does not fully reflect market trends”.

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