The latest housing finance figures released on Friday by the Australian Bureau of Statistics (ABS) confirm a moderating housing market.

The Real Estate Institute of Australia (REIA) says the figures for October 2016 show, in trend terms that the number of owner-occupied finance commitments fell by 0.9 per cent – the tenth consecutive month of slight declines. If refinancing is excluded, in trend terms for October, the number of owner-occupied finance commitments decreased by 0.8 per cent – the twelfth consecutive month of decreases.

REIA President, Malcolm Gunning said “decreases were recorded in all states except Tasmania with the Northern Territory having the largest decrease of 3.2 per cent. The increase in Tasmania was 0.7 per cent.”

“In trend terms, the number of established dwellings purchase commitments fell by 1.0 percent while new dwelling construction decreased by 0.7 per cent and the purchase of new dwellings decreased by 0.3 per cent.”

“The value of investment housing commitments increased by 1.5 per cent in October but is down from its 2015 peak in response to the increase in mortgage rates for investors and the strengthening of banks’ non-price lending terms.”

“Whilst the proportion of first home buyers, as part of the total owner-occupied housing finance commitments, increased to 13.7 per cent from 13.1 per cent in September, the number of first home buyer commitments fell. This increase in the proportion was due to a fall in the number of non-first home buyer commitments.”

“The monthly average for the proportion of first home buyers for the last twelve months is 13.5 per cent compared to 20.9 per cent for the corresponding period two decades ago – disappointingly this is a fall of nearly 40 per cent and appears to be a downward spiral.”

“The figures show that the market is adjusting and that there is no need for further intervention by the regulators”, concluded Mr Gunning.