The RBA has just released the latest data on Private Sector Credit and while it remains clear that Australian’s overall demand for debt is only increasing at a fairly low rate by historical standards there is an acceleration in mortgage debt underway.
The RBA reported that “total credit provided to the private sector by financial intermediaries grew by 0.3 per cent over October 2013 after increasing by 0.3 per cent over September. Over the year to October, total credit rose by 3.5 per cent.”
Housing itself is starting to pick up and is up 1% in the last two months with back-to-back rises of 0.5% in September and October. And the year on year result is starting to accelerate to 5%. But the RBA said: “other personal credit decreased by 0.1 per cent over October after increasing by 0.3 per cent over September. Over the year to October, other personal credit increased by 0.6 per cent.”
There is a turn in demand for housing debt – only slight but it is clear.
APRA and the Reserve Bank will be watching.
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