The RBA has released its financial aggregates data for September and they show very muted growth of just 0.3%, with the year-on-year rate of growth just 3.3%.
Other personal credit – credit cards, personal loans and so on – increased by 0.3%, but are up 1% for the 12 months to September.
Clearly Australian households are still fairly hesitant to borrow at the moment — an enduring theme since GFC.
But it creates an interesting dichotomy.
The difficultly is how to read the data for the Australian economy, with building approvals being driven sharply higher by an increase in unit approvals.
Are approvals an anticipatory step before the demand for debt rises, as the economy heals and transitions. Or are building developers reacting to the strong increase in house prices over the past few months, and the pent up demand that has resulted from a lack of supply of properties on the market?
What is clear however is that even though investor demand for debt has increased, and is increasing faster than owner-occupied, neither is growing at a rate that will worry the authorities.
So while Australian borrowers remain circumspect those with cash are really driving prices higher in the housing market.