Mortgage risk edges up in the June quarter
Mortgage lending in two of the Australian Prudential Regulation Authority's high-risk categories - investment and interest-only lending - rose as a proportion of total lending in the March quarter. However, the proportion of new loans with high loan-to-valuation ratios fell in the quarter.According to APRA's latest report on the property exposures of authorised deposit-taking institutions, total new mortgage lending by ADIs in the June quarter was worth A$98.4 billion, compared with $81.5 billion in the March quarter.The big jump - more than 20 per cent - is due in part to a data revision after three institutions re-submitted their figures.Investment loans made up 34.6 per cent of the value of new lending in the June quarter, compared with 31.5 per cent in the March quarter.Loans with loan-to-valuation ratios between 80 per cent and 90 per cent made up 13.7 per cent of the value of new lending in the June quarter, the same proportion as in the March quarter.Loans with LVRs above 90 per cent made up 8.3 per cent of the total, compared with 8.6 per cent in the March quarter.Interest-only loans made up 36.2 per cent of the total, compared with 34.9 per cent in the March quarter.Loans approved outside serviceability made up 3.5 per cent of the total, compared with 4.4 per cent in the March quarter.The proportion of loans originated by third parties (APRA consider broker originated loans riskier than loans originated through proprietary channels) rose from 46.5 per cent to 48.1 per cent.