This result surpasses the four-year high reported from October. 

Westpac Senior Economist Andrew Hanlan said credit growth had not reached these heights since November 2008, prior to the impact of the GFC.

"This represents a dramatic acceleration from the anaemic 1.7% increase in 2020," Mr Hanlan said. 

Twelve-month housing credit grew to 7.4% in December, with owner-occupiers leading the charge recording an annual growth of 9.6% - again the strongest annual result since 2008.

For investors, twelve-month housing credit recorded annual growth of 3.4%.

Mr Hanlan said the housing sector has been in a brisk upswing, punctuated at times by lockdowns.

"This strength is in response to record low rates, the HomeBuilder program and a switch in demand as folk looked for more space at home," he said.

CommBank Senior Economist Belinda Allen said the recent rise in fixed rate loans for both owner-occupiers and investors as well as the growing expectations of official cash rate rises in 2022 should weigh on housing credit growth in the period ahead.

"Regulators will remain watchful of the pace of both new lending and the stock of credit, as well as lending at high debt to income ratios and loan to valuation ratios," Ms Allen said.
CBA forecasts credit growth to remain firm though housing credit could taper with the expected lift in the RBA cash rate in August 2022.

Personal credit falls

Personal credit fell by 0.8% in December and remains 3.8% below levels a year ago.

The fall in December comes after 0.6% gains were recorded in November. 

Ms Allen said although lending has lifted for holidays and cars in CBA lending data, households as a group have a significant pool of savings which has reduced the need to borrow.

"At this stage CBA card spend data has been encouraging during the Omicron outbreak, save the first two weeks of January but a degree of uncertainty could creep in for big ticket items that often require loans like cars, applications or holidays," she said.

Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.

Rates
Features
Fees
Other
Lender
VariableMore details
Online ExclusiveUp To $4K Cashback Includes NOV RBA Rate Increase
  • Immediate cashback upon settlement
  • $2000 for loans up to $700,000
  • $4000 for loans over $700,000
Online ExclusiveUp To $4K Cashback Includes NOV RBA Rate Increase

loans.com.au – Variable Basic Cashback Home Loan (Principal and Interest) (LVR < 70%)

  • Immediate cashback upon settlement
  • $2000 for loans up to $700,000
  • $4000 for loans over $700,000
More details
VariableMore details
Refinance OnlyApply In Minutes
  • No application or ongoing fees. Annual rate discount
  • Unlimited redraws & additional repayments. LVR <80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
Refinance OnlyApply In Minutes

Unloan – Variable Rate Home Loan – Refinance Only

  • No application or ongoing fees. Annual rate discount
  • Unlimited redraws & additional repayments. LVR <80%
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
More details
VariableMore details
  • Up is 100% owned by Bendigo Bank.
  • Up to 50 offset accounts
  • New joiners get $10 by signing up to the app using code UPHOMESAVINGS. (T&Cs apply)

Up – Up Home Variable (Principal & Interest) (LVR ≤ 90)

  • Up is 100% owned by Bendigo Bank.
  • Up to 50 offset accounts
  • New joiners get $10 by signing up to the app using code UPHOMESAVINGS. (T&Cs apply)
More details
  • Immediate cashback upon settlement
  • $2000 for loans up to $700,000
  • $4000 for loans over $700,000

More details
Important Information and Comparison Rate Warning

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of December 8, 2023. View disclaimer.

Image by Qimono via Pixabay.



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