Borrow
Home loan commitments crash for the first time since May
New loan commitments for housing have declined for the first time since May 2020, but months of growth have ensured records have been maintained, new data has shown.
Home loan commitments crash for the first time since May
New loan commitments for housing have declined for the first time since May 2020, but months of growth have ensured records have been maintained, new data has shown.
After eight consecutive months of growth, new loan commitments for housing fell 0.4 per cent to $28.6 billion in February 2021, the Australian Bureau of Statistics’ (ABS) Lending to Households and Business figures showed.
While this is the first fall in almost a year, commitments remain close to record high levels, the report indicated.
According to ABS head of finance and wealth Katherine Keenan, the fall in February was driven by reduced loan commitments for existing dwellings, but the value of these loan commitments remained 39.7 per cent higher than in February 2020.
Overall, new loan commitments for owner-occupier housing fell 1.8 per cent in February 2021, but stood 55.2 per cent higher compared with February 2020.
All states and territories, except NSW, Queensland and the ACT, saw lifts in new loan commitments for owner-occupier housing.
NSW had the largest fall at 4.9 per cent, while Victoria had the largest increase at 4.2 per cent.
“With lending approvals being a leading indicator of demand and anecdotal information from agents suggesting that increased listing enquiries will improve supply, we should see an easing of pressure on prices and thus not requiring any macro-prudential measures to curb lending,” according to Real Estate Institute of Australia (REIA) president Adrian Kelly.
“Borrowers should nevertheless be prudent in their borrowing, and with their bank’s assistance, pressure test their ability to meet repayments should interest rates increase,” he continued.
On the other hand, the value of new loan commitments for investor housing rose 4.5 per cent to $6.9 billion in February 2021, which is 31.6 per cent higher than in February 2020. This is on the back of improving rental market conditions, Mr Kelly highlighted.
“Investor lending continued an unbroken period of growth since reaching a 20-year low in May 2020,” Ms Keenan noted.
Increases were seen in all states and territories, with the exception of Tasmania and the two territories.
The largest increase in the value of new loan commitments to investors was seen in Victoria for the second consecutive month, with an increase of 13.1 per cent in February.
Meanwhile, the value of loan commitments for the construction of new dwellings has also risen by 4.4 per cent on the back of a consistent period of record rises since July 2020.
According to Ms Keenan, the HomeBuilder grant continued to influence the results despite being reduced from 1 January 2021 as “it was made more widely available to borrowers in NSW and Victoria through increased price caps on new build contracts”.
RELATED ARTICLES
-
Australia’s credit pivot: Mortgage enquiries hit a three‑year peak as households lean on plastic — what lenders and fintechs must do next
-
Trust is the new yield: Why brokers win when credibility compounds
-
Mortgage Relief Window: How Australia’s Lenders Are Rewiring Risk and Growth at a Three‑Year Lull
About the author
About the author
Loans
Australia’s credit pivot: Mortgage enquiries hit a three‑year peak as households lean on plastic — what lenders and fintechs must do next
Australian home loan interest has rebounded even as households lean harder on cards and personal loans — a classic late‑cycle signal that demands sharper risk, pricing and AI executionRead more
Loans
Trust is the new yield: Why brokers win when credibility compounds
In a market where products look interchangeable, credibility has become the most defensible asset in mortgage broking. With broker channel share hitting record highs and AI reshaping client ...Read more
Loans
Mortgage Relief Window: How Australia’s Lenders Are Rewiring Risk and Growth at a Three‑Year Lull
Australia’s mortgage stress has eased to its lowest level since early 2023, creating a rare—likely brief—window for lenders, brokers and fintechs to reset risk and rebuild growth. This case study ...Read more
Loans
Why ANZ’s tougher stance on company-borrowed home loans matters: A case study in risk recalibration, competition, and what CFOs should do next
ANZ has tightened mortgage credit parameters for loans where a company or trust is the borrower—an apparently narrow policy tweak with wide operational consequences. It signals a broader recalibration ...Read more
Loans
Mortgage 2026: Australia’s share‑of‑wallet war will be won on switching, data rights and AI discipline
The defining feature of Australia’s 2026 mortgage market won’t be house prices; it will be switching velocity. With competition reforms sharpening the Consumer Data Right, lenders and brokers that ...Read more
Loans
Mortgage remorse reshapes the game: Australia's lending squeeze set to redefine banking and household demand
A growing cohort of Australians is rethinking recent home loan decisions as higher repayments collide with household budgets. This isn’t just consumer angst; it’s an economy-wide red flag for lenders, ...Read more
Loans
Aussie mortgage game-changer: Brokers dominate while AI sharpens the edge
Mortgage brokers now originate roughly three in four new Australian home loans, a structural shift that rewires bank economics, product strategy and customer acquisition. MFAA data shows broker market ...Read more
Loans
Fixing the future: How brokers and lenders can turn rate-hike anxiety into strategic advantage
Australian borrowers are leaning into short-term fixed loans as rate uncertainty lingers, shifting risk from households to lenders and their funding partners. That creates a narrow window for broker ...Read more
Loans
Australia’s credit pivot: Mortgage enquiries hit a three‑year peak as households lean on plastic — what lenders and fintechs must do next
Australian home loan interest has rebounded even as households lean harder on cards and personal loans — a classic late‑cycle signal that demands sharper risk, pricing and AI executionRead more
Loans
Trust is the new yield: Why brokers win when credibility compounds
In a market where products look interchangeable, credibility has become the most defensible asset in mortgage broking. With broker channel share hitting record highs and AI reshaping client ...Read more
Loans
Mortgage Relief Window: How Australia’s Lenders Are Rewiring Risk and Growth at a Three‑Year Lull
Australia’s mortgage stress has eased to its lowest level since early 2023, creating a rare—likely brief—window for lenders, brokers and fintechs to reset risk and rebuild growth. This case study ...Read more
Loans
Why ANZ’s tougher stance on company-borrowed home loans matters: A case study in risk recalibration, competition, and what CFOs should do next
ANZ has tightened mortgage credit parameters for loans where a company or trust is the borrower—an apparently narrow policy tweak with wide operational consequences. It signals a broader recalibration ...Read more
Loans
Mortgage 2026: Australia’s share‑of‑wallet war will be won on switching, data rights and AI discipline
The defining feature of Australia’s 2026 mortgage market won’t be house prices; it will be switching velocity. With competition reforms sharpening the Consumer Data Right, lenders and brokers that ...Read more
Loans
Mortgage remorse reshapes the game: Australia's lending squeeze set to redefine banking and household demand
A growing cohort of Australians is rethinking recent home loan decisions as higher repayments collide with household budgets. This isn’t just consumer angst; it’s an economy-wide red flag for lenders, ...Read more
Loans
Aussie mortgage game-changer: Brokers dominate while AI sharpens the edge
Mortgage brokers now originate roughly three in four new Australian home loans, a structural shift that rewires bank economics, product strategy and customer acquisition. MFAA data shows broker market ...Read more
Loans
Fixing the future: How brokers and lenders can turn rate-hike anxiety into strategic advantage
Australian borrowers are leaning into short-term fixed loans as rate uncertainty lingers, shifting risk from households to lenders and their funding partners. That creates a narrow window for broker ...Read more
