Property investor lending shrunk 2.5 percent in March, while owner-occupiers kept demand for finance alive, the latest Australian Bureau of Statistics data show.

The shrinking investor lending reflects forecasts of a fall in home prices of more than 10 per cent this year.
National house prices grew slightly by 0.3 per cent in April the smallest monthly growth in values since the beginning of the market recovery in mid-2019 down from 0.7 per cent in March.
CoreLogics Hedonic Home Value Index showed the biggest fall so far was in Melbourne, where prices fell 0.3 per cent in April, and Hobart, with a 0.1 per cent drop.
On Monday Westpac reported that it expected residential property prices to fall 15 per cent this year and another 5 per cent next year.
It said property and property services were “under greater risk of downgrade”.
Commonwealth Bank economist Kristina Clifton said she expected home lending to slide in April.
“There are early signs this momentum is softening and we do expect it to soften in coming months in line with our view of a 10 per cent fall in residential property prices in the next six months,” she said.
“We expect to see lending growth soften in April in line with other indicators of the housing market as public open homes and auctions were banned and the number of house sales retreated.”
CommSec’s Craig James said the latest lending and home price figures raised the question as to whether housing could hold up aginast expectations.
“Could the housing market hold up a lot better than many expect? Home prices arent sliding and interest rates are super low,” Mr James said.
“But the job market will be fundamental to prospects as well as the reduced demand caused by the drying up of migrant inflow.”
Last week Treasury revealed that Australia could take an 85 per cent hit to net migration in financial year 2021.
Housing Industry Association chief economist Tim Reardon said the latest ABS lending figures showed some positive signs for the construction market pre COVID-19.
“The number of loans to owner occupiers for the purchase or construction of a new home rose by 3.1 per cent in the March 2020 quarter compared to the December quarter,” Mr Reardon said.
These results, along with other leading indicators such as new home sales and building approvals data, continue to confirm that the housing market had reached a turning point mid-way through 2019, providing further evidence that the housing market, pre-COVID-19, was heading into 2020 looking upwards, he said.
The lending data showed that the number of owner-occupier first home buyer loans is now at a decade high of 9841 in March, representing 37.1 per cent of all owner-occupier loans.
The lending data also showed that personal finance fixed-term loan commitments fell by 8.2 per cent in March.