That's according to the Australian Bureau of Statistics (ABS) Lending Indicators data for February 2020, which also found new loan commitments rose 0.4% and 0.5% for owner-occupiers and investors respectively, implying borrowers are borrowing less.

This also represents a 1.7% and 1.9% respective drop in new loan commitments in seasonally-adjusted terms on February 2019, according to ABS chief economist Bruce Hockman.

“February’s fall in the value of new loan commitments for housing follows considerable growth in the series from mid-2019 onwards," he said.

The ABS release also noted there was "no notable impact" from the COVID-19 virus on new lending commitments in February - before travel restrictions and restrictions on auctions and inspections took place.

The total value of new loan commitments in February for owner-occupiers was $14.15 billion, and $5.30 billion for investors in seasonally-adjusted terms.

Buying an investment property or looking to refinance? The table below features home loans with some of the lowest variable interest rates on the market for investors.

Update resultsUpdate
LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkCompare
6.19% p.a.
6.58% p.a.
Principal & Interest
Featured 90% LVR
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6.29% p.a.
6.20% p.a.
Principal & Interest
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  • A low-rate variable investment home loan from a 100% online lender. Backed by the Commonwealth Bank.
6.34% p.a.
6.59% p.a.
Principal & Interest
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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 . View disclaimer.

Coronavirus won't impact data until March

Westpac senior economist Matthew Hassan said the results were softer than expected, but to expect steeper drops in March's data.

"The detail was soft across most segments and is despite both price gains and turnover still holding up reasonably well in the month," he said.

"While the starting point is a touch softer the main story is still of a likely severe decline as coronavirus effects impact in coming months."

However, Mr Hassan did point to a positive in the data - an uptick in construction loans.

"Construction-related loans bucked the wider monthly decline, posting a 1.9% rise, likely supported at the margin but post-bushfire rebuilding activity," he said.

Housing Industry Australia economist Angela Lillicrap highlighted first home buyer activity was strong and that investor lending is showing signs of improvement.

“First home buyers remained active in the market, with the largest number of loans issued to first home buyers during the month in over a decade," she said.

“Investor lending was also improving, up by 3.4% in the quarter to be 6.3% higher than the same time last year."

The news comes after experts predicted 20% to 30% price drops by the end of the year.

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