Resources: Market Update
March 2010
AMP CUTS VARIABLE RATES
Posted 10/03/10
In a move that has been welcomed by the Federal Governement AMP has cut its introductory variable mortgage rate by 0.45% and its basic variable rate by 0.22%.
CEO Craig Dunn wrote to treasurer Wayne Swan and told him AMP were "able to achieve these reductions in a large part due to the Government's recent initiative through the Australian Office of Financial Management (AOFM) in the Australian securitisation market. This, coupled with the AOFM's stated ongoing program of support, gives AMP the capacity to implement these reductions."
The new introductory rate of 5.49% makes AMP one of the most competitive lenders in the field. NAB are at 6.74%, CBA 6.86%, ANZ 6.91% and Westpac 7.01%.
A revived market for Residential Mortgage Backed Securities (RMBS) is certainly a great thing competition.
HOME LOAN APPROVALS FALL IN JANUARY
Posted 10/03/10
Data from the Australian Bureau of Statistics showed home loan approvals plummeted by 7.9 per cent in January, the biggest fall since June 2000.
Moody's Analytics economist Matthew Circosta said ''This marks the fourth consecutive decline in housing finance since the Reserve Bank of Australia commenced tightening monetary policy, suggesting momentum in the property market is fading,''
However on the other side of the fence Matthew Bell from Australian Property Monitors (APM) recently said "The medium- to long-term outlook for property prices remains strong, as high population growth, rising incomes and a relative lack of new supply means there will simply be more demand for housing than supply,"
With real estate agents everywhere complaining about the lack of property to sell it seems to reinforce what Matthew Bell from APM is saying.
AUSSIE PLANS TO BRING THE COMPETITION BACK
Posted 08/03/10
Aussie Home Loans has just announced it plans to ramp up the sale of its own home loan products as the capital markets get stronger.
John Symond Aussie's founder and executive chairman said "We are going to go back on the attack and put out home loans and instead of 95 per cent of our loans being brokered it will fall to 75 per cent,"
"We are gearing up over the next four months to get right back into home lending - it will be cheeky and we will provide some competition again."
Assistance from the Commonwealth Bank of Australia has allowed Aussie to arrange $1 billion of securitised funds.
RATE RISE THE FIRST OF THE YEAR
Posted 02/03/10
The Reserve Bank today raised the interest rate by 0.25% for the first time this year to 4 per cent.
In a statement Governor Glenn Stevens said that the global economy was growing and that Australia's economic conditions in 2009 were stronger than expected.
"The rate of unemployment appears to have peaked at a much lower level than earlier expected. Labour market data and a range of business surveys suggest growth in the economy may have already been at or close to trend for a few months", he said.
There were positive signs earlier in the day including a falling jobless rate, the latest retail sales data - up 1.2 per cent in January and rising home prices.
The latest rate rise is being used to keep inflation under control.
HOUSE PRICES CONTINUE TO GROW
Posted 01/03/2010
The RP Data-Rismark Hedonic Home Value Index showed home prices rose an average 11.8 per cent over the previous 12 months.
Rismark International managing director Christopher Joye said "The data was certainly stronger than we expected,".
Home prices over the 12 months to January rose in Melbourne by over 17%, Darwin, by 15% and Canberra, by 14%.
During the same period Sydney prices rose by just over 10%, Hobart by 9%, Brisbane and Adelaide by 8% and Perth the lowest with 7%.
This will most likely give the Reserve Bank of Australia further ammunition to raise interest rates, however the price growth should slow down to under 10% during 2010. .
CommSec chief economist Craig James said while the January figures looked strong, an average during the past two months appeared to show that growth had peaked.
