Home loan approvals rose for the fourth consecutive month in September, exceeding analyst expectations despite a slump in investor lending.
The number of approvals rose 2 per cent in the month, against analyst expectations of no change. The result came after a 2.9 per cent rise in August.
There were 55,985 approvals in September, compared to 55,677 approvals in August, according to seasonally adjusted figures released by the Australian Bureau of Statistics on Tuesday.
The value of total housing finance fell 1.6 per cent in the month to $33.37 billion.
The value of loans approved for owner-occupied housing jumped 3 per cent, while approvals for investment slumped 8.5 per cent.
All major banks have bumped up their interest rates on investment loans in response to requirements to increase their capital reserves.
CommSec chief economist Craig James said the figures showed the biggest drop for investor loans in seven years, and regulators would be satisfied that their measures were working to slow demand.
"The Reserve Bank would be happy at the mix of lending in the housing market," he said.
But JP Morgan economist Tom Kennedy said the central bank in a speech last week indicated it was sceptical of the data, and urged banks to refine and improve it.
"There's some other things going on behind the scenes in terms of reclassifying data from investors to owner-occupiers," he said.
RBC Capital Markets fixed income and currency strategist Michael Turner said figures from the banks have been revised to show a much higher level of investor credit outstanding.
"And borrowers now have an incentive to report loans as owner occupier given the relative increase in rates charged for investor lending," he said.
Regardless, demand for overall housing credit has steadied during the past few months, Mr Turner said.