Shifting tides: lower interest rates begin to fuel a hotter lending market

According to Kelvin Davidson of Cotality, falling interest rates are fueling a significant rise in mortgage lending. April saw $7.6 billion in new lending, the 10th consecutive monthly increase, indicating growing borrower confidence.

First home buyers (FHBs) are a major force, with many successfully securing low-deposit loans. Banks are showing more flexibility on loan-to-value and debt-to-income ratios, meaning money is available for qualified borrowers. However, the housing recovery may remain subdued until the broader economy improves.