Credit reporting agency Equifax’s quarterly consumer credit demand index shows the number of mortgage applications in the three months to June across Australia were down 0.9 per cent from a year ago.

Equifax senior general manager Angus Luffman says this is the second consecutive quarter of declining mortgage applications, and it marks the start of a “downward trend” in all states.

“Any debate about whether the housing market is softening should now be put to rest,” Luffman said in a statement.

“We can clearly see that, even in the historically strong geographies on the eastern seaboard, mortgage application demand is slowing or already in decline.”

The finding comes after property analytics firm CoreLogic said the number of homes up for auction across Sydney, Melbourne, Brisbane, Adelaide and Perth fell for the fourth consecutive week in the seven days to July 16.

At the same time, house prices rose in each of those cities except for Perth, where they remained steady.

Equifax said consumer credit applications were up 10.3 per cent in the June quarter, spurred on by an 18.4 per cent increase in applications for personal loans.

This could indicate people are turning to that line of credit to support their household and discretionary spending, Luffman said.

The increase in loans has not been matched with a rise in total credit balances though, which have remained flat for years, when housing is excluded.

“Given the current subdued growth in household incomes, and below-neutral consumer sentiment, it is understandable that Australians may be becoming more circumspect in their use of consumer credit products,” Luffman said.

Credit card applications were up a modest 2.3 per cent in the June quarter.

– AAP