AFG mortgage index: Investment-based home loans at their highest level ever

Australia saw a rise in the number of individuals getting approval for home loans for investment purposes during February, defying many analysts who claim that the property market is "experiencing the formation of a bubble".

The AFG mortgage index has recorded the highest level of investment interest in its history, with 34.1 per cent of all loans cleared for individuals looking at property investment.

This figure was an increase on the 27.1 per cent recorded by the index in August last year.

AFG sales and operations general manager Mark Hewitt said: "People had been sitting on their hands in relation to property investment … they've been in and out of the share-market, but that's still seen as a bit risky.

"They have regained confidence in property being a sound investment - that's the feeling we're getting."

Figures released recently by RP Data revealed that last month property values in the country increased on average by two per cent.

Among the regions posting the biggest gains were Darwin, boasting a 4.6 per cent rise, alongside Canberra and Melbourne, which both posted 4.3 per cent increases.

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