The value of housing finance commitments was recorded at $31.9 billion for the month of January, showing a decline in mortgage lending of 3.4% over the month according to CoreLogic's Cameron Kusher. This is the largest drop for the month since 2011.

Both the owner-occupier and investor components of lending fell in the first month of the year. The value of owner-occupier commitments fell by 4.3% over the month, but was 15.9% higher year-over-year, while investor commitments fell by 1.6% in January and decreased by 14.8% year-over-year.

Mortgage lending often decreases in January, but with a decline of this magnitude, economists are wondering if the shrinking mortgage rate will continue throughout the rest of the year:

The CoreLogic Mortgage Index which is published weekly and tracks mortgage activity across our proprietary platforms indicates that January was a weak month for housing finance commitments. We would expect that housing finance commitments will rise in February and so far March also points to increasing demand. However, mortgage demand remains lower than it was at the end of last year and lower than it was a year ago. While housing finance commitments should increase from their January levels it is unlikely that demand will start to grow as strongly as it was in the early part of last year or late in 2015.

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