Mortgage settlement growth to intensify

87Australia’s mortgage market “is on the cusp of exciting change,” according to a report from Deloitte.

The multinational advisory firm released its report, “A consumer-led revolution in mortgages” on March 3 and there are findings that could affect buyers and investors in the Sydney property market.

It’s predicted that mortgage settlement growth has returned, with competition set to intensify during 2014.

Borrower confidence is high according to Deloitte Banking Partner James Hickey.

Furthermore, investors are clawing back, with funding pressures softening.

This will result in a “vibrant and competitive mortgage market this year and through to 2017,” announced Mr Hickey.

Climbing ahead

Looking ahead, it’s clear that lenders, brokers and consumers will need to tackle the digital and data revolution.

“The consensus from the Deloitte Mortgage Report roundtable was that digital and data will be the main game for mortgages over the next three years,” stated Mr Hickey.

Figures from 2013 are promising, which should put Australia’s mortgage market in a good position for the future.

Over the course of last, settlements across the country on a monthly basis headed above the $28 billion mark.

“That is the highest single monthly settlement rate on record, and a clear jump since the onset of the GFC, when they struggled to reach $20 billion,” said Mr Hickey.

With the strength of 2013, it seems the Australian mortgage market is well primed for future growth.

Strong areas of the market 

The majority of growth in settlement volumes last year “was due to existing owner-occupiers upgrading and investors returning rather than first home buyers entering,” said Mr Hickey.

In areas like Sydney where demand is high and capital growth is consistently ahead of many other capital cities, it’s no surprise that existing homeowners and investors are driving settlements.

The game is more difficult for first home buyers although with increasing approvals for high-density dwellings, this could ease the pressure on real estate supply.

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