Tasmanian housing lending crashed in May, but a bank is seeing signs of increased interest from potential buyers.
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New home loans for owner occupation regularly topped 700 in Tasmania in the months before the coronavirus pandemic and economic crash and totalled 772 in March in original terms, according to the Australian Bureau of Statistics.
They fell to 689 in April and plummeted to just 620 in May.
It was a similar story nationally, with the value of new home loan commitments dropping by a biggest on record 11.6 per cent in seasonally adjusted terms.
The ABS said the value of new loan commitments nationally for owner occupier housing fell by 10.2 per cent, while investor housing fell 15.6 per cent.
The number of owner occupier first home buyer loan commitments fell by 9.3 per cent.
"While reduced transactions in the housing market stifled new loan activity in May, the value of existing owner occupier loans refinanced with a different bank was by far the highest on record as borrowers responded to reduced interest rates and refinancing offers", ABS chief economist Bruce Hockman said.
Tasmanian-based Bank of us - which recently offered a fixed home loan rate of 1.99 per cent - also noted strong activity in the refinancing market.
"There's no doubt that in the last couple of months we've seen things drop a little generally in the Tasmanian market," Bank of us chief customer and people officer Jill Jetson-Shumbusho said.
"What we've seen, though, is a real shift into focus on the refinance market."
Ms Jetson-Shumbusho said the bank had experienced "a real uptick" in home lending inquiries since the state and federal governments announced stimulus measures to support the housing sector during the downturn.
That had been through the bank's branches and via its partnership with building firm Wilson Homes, which she said had been "inundated with inquiries".
She said the bank decided to offer the 1.99 per cent fixed rate off the back of the government measures to support the building industry as a way of supporting Tasmanians and the economy.
Ms Jetson-Shumbusho said it had led to very strong inquiry levels.
"The lull of COVID, we feel, is over ... but only time will tell," she said.
"It's very hard to predict.
"The initiatives that have been put in place are benefiting us at this point in time."
Sean Ford
The Advocate Newspaper, Tasmania. Business, economics, politics, crime.
The Advocate Newspaper, Tasmania. Business, economics, politics, crime.
