The Reserve Bank of Australia (RBA) today released credit aggregates data for January, which reported a sharp slowdown in mortgage growth.
The total value of mortgages outstanding only grew by 1.0% over the January quarter, which was the slowest growth rate since October 2020:
Owner-occupier mortgages grew 1.1% over the January quarter versus just 0.7% growth in investor mortgages:
The sharp decline in mortgage growth makes sense given the Reserve Bank of Australia’s (RBA) aggressive interest rate hikes, which has shrunk borrowing capacity by around one third.
The volume of home sales has also contracted (see below chart) alongside the circa 10% decline in national home values.
Given the RBA expects to lift rates further in the month ahead, mortgage growth should soften further.
