Mortgage sales in Australia dropped 3.7 percent in July, amidst concerns of a hike in interest rates and the implementation of a carbon tax, according to a major broker.
The Australian Finance Group (AFG) Mortgage Index indicated the most noticeable decline was in Victoria at 7.4 percent, followed by New South Wales (5.9 percent), Western Australia (5.0 percent) and Queensland (0.5 percent).
Mark Hewitt, General Manager of Sales and Operations at AFG, said residential borrowers have been conservative since the November 2010 cash rate hike.
He noted that Australians are still apprehensive about their financial well-being.
“Domestic financial news is dominated by talk of rate rises and the carbon tax," said Hewitt, in a statement released with the index.
“Gloomy international financial news has seen stock markets slump.”
“We’re all looking for strong economic leadership to provide the market with some much needed confidence.”
The data revealed that refinancing is still the mortgage market’s most active part, with 39.1 percent of loans last month.
The percentage of owner-tenants arranging mortgages to reallocate or upgrade their homes constituted 11.7 percent of all mortgages in July.
AFG said that it provides over 20 percent of brokers access to lending establishments, with a mortgage book of over AU$65 billion.
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