Home loan lending growth hits four year high

author-avatar By
on November 30, 2021 Fact Checked
Home loan lending growth hits four year high

Reserve Bank data released Tuesday shows 12-month ended housing growth to October 2021 hit 6.7% - the highest rate since July 2017.

Twelve-month ended owner occupier housing credit growth was 9.0% - the highest rate of growth since August 2016.

This is despite ABS lending data indicating owner occupier lending is tapering off.

Twelve-month ended investor credit growth increased 0.2 percentage points to 2.6% - the highest since February 2018.

There are mixed signals in the market presently, with APRA announcing serviceability tightening in October and effective November, with fixed home loan rates increasing.

The Reserve Bank cash rate is also tipped to increase before its initial 2024 guidance, and CBA has tipped house price falls of up to 10% in 2023.

As a result, last week SQM Research tipped property price rises to ease in mid-2022, led by falls in Sydney and Melbourne.

However Propertyology's head of research Simon Pressley said households' financial foundations are still solid.

"Bottom line though, much of the credit growth over the last two years is a release of pent-up demand created by APRA squeezing the beejezus out of credit over the previous four years," Mr Pressley told Savings.com.au on Tuesday.

"When considering this credit growth stuff, the likes of ABS, RBA and economists often forget that Australia generally adds an extra 350,000 people and 200,000 extra dwellings each year.

"More people, more dwellings should always mean more credit - if not, we’d be in recession and losing jobs."

ANZ slows mortgage leak

The latest APRA data shows ANZ held $260.356 billion in owner occupied and investment housing mortgages at the end of October - about $66 million less than at the end of September.

This is much slower than previous rates of leakage, with the bank at one stage leaking $1 billion in mortgage customers in a month - where refinances and discharges outpaced the rate of new lending.

ANZ's mortgage leak has been well documented, and has been attributed to slow application and approval times, especially through broker channels where some customers are waiting up to six weeks.

ANZ executive Mark Hand previously said this was a "level we weren't happy with".

CommBank generally leads the rate of growth among majors, growing its owner occupier loan book by about $3 billion alone over the past recorded month.


Advertisement

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.

Lender

Variable
More details
UNLIMITED REDRAWSSPECIAL OFFER
  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
UNLIMITED REDRAWSSPECIAL OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
Variable
More details
100% FULL OFFSET ACCOUNTNO APPLICATION FEE OR ONGOING FEES
  • No upfront or ongoing fees
  • 100% full offset account
  • Extra repayments + redraw services
100% FULL OFFSET ACCOUNTNO APPLICATION FEE OR ONGOING FEES

Low Rate Home Loan - Prime (Principal and Interest) (Owner Occupied) (LVR < 60%)

  • No upfront or ongoing fees
  • 100% full offset account
  • Extra repayments + redraw services
Variable
More details
NSW/VIC/SA METRO & INNER REGIONAL AREAS
NSW/VIC/SA METRO & INNER REGIONAL AREAS

Variable Home Loan (Principal and Interest)

  • $5000 Cashback. T&Cs Apply.
Variable
More details
REFINANCE ONLY
  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
REFINANCE ONLY

Variable Rate Home Loan – Refinance Only

  • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
Variable
More details
NO ONGOING FEESFREE REDRAW FACILITY
  • Rate Match Guarantee. Tic:Toc will match the rate on identical variable P&I home loans. T&C's Apply.
NO ONGOING FEESFREE REDRAW FACILITY

Live-in Variable Loan (Principal and Interest) (LVR < 90%)

  • Rate Match Guarantee. Tic:Toc will match the rate on identical variable P&I home loans. T&C's Apply.

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. All products will list the LVR with the product and rate which are clearly published on the Product Provider’s web site. 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 June 25, 2022. View disclaimer.


Photo by Robert Linder on Unsplash

Latest Articles

author-avatar
Harrison is Savings.com.au's Assistant Editor. Prior to joining Savings in January 2020, he worked for some of Australia's largest comparison sites and media organisations. With a keen interest in the economy, housing policy, and personal finance, Harrison strives to deliver and edit news and guides that are engaging, thought-provoking, and simple to read.

Be Savings smart.
Subscribe for free money newsletters.

By subscribing you agree
to the Savings Privacy Policy