mortgage credit demand slumps 23.8%

http://www.brokernews.com.au/news/newsletter/50423

Mortgage credit demand slumps
By BN | 10 Nov 2010
Mortgage credit demand declined 23.8% year-on-year during the July to September quarter, according to Veda Advantage.

Veda's quarterly Consumer Credit Demand Index, released today, said the fall in demand this quarter showed a similar result to the 20% dive recorded in the April to June 2010 quarter over the previous year. The results were the third consecutive quarter decline in mortgage credit demand.

Angus Luffman, Veda Advantage head of consumer risk, said mortgage applications have dropped to record levels since the beginning of the year, with demand now at a level similar to that experienced during the midst of the GFC.

"The record decline continues to be measured against the impact of the Government stimulus package for first home buyers which inflated mortgage demand growth last year," Luffman said.

Overall, consumer credit demand was flat during the quarter, growing only 0.7% year-on-year. Veda said in a statement that consumers continue to be circumspect in their demand for additional debt via credit cards and personal loans in the post-GFC environment.

According to Veda, consumer behaviour has become generally more frugal over the past six months.