- NAB's home loan applications dropped by 15% in the June quarter compared to the previous quarter
- The value of those applications was 9% lower quarter-on-quarter
- NAB also revealed the number of "watch" loans jumped 8% over the same period
NAB's briefing to the ASX painted a grim picture of its home lending business, with total home loan applications falling 15% in the June quarter compared to the March quarter.
The combined value of those applications was 9% lower.
The big four bank also revealed the number of "watch" loans increased by 8% over the quarter, "reflecting current and potential impacts from a challenging environment", the statement said.
The downturns were offset by modest rises in business lending balances (up 4%) and at-call deposits (up 3%, excluding offset accounts).
NAB's business and private banking executive Andrew Auerbach acknowledged the "challenging economic environment" ahead of the bank's third quarter trading update, due on 17 August.
Home lending well dries up
NAB is the first of the major banks to supply some hard figures on the downturn in home lending amid a stagnating property market.
Home values are falling in Australia's two biggest cities while price growth is slowing across other markets, according to the most recent property industry data.
Housing market activity was already sluggish from the effects of three consecutive interest rate hikes in 2026 before the May federal budget's housing investor tax changes delivered another shock.
Three weeks after the 12 May budget, Westpac reported its investor home loan applications had plunged by 20% with broader applications falling by much the same volume.
Earlier this month, credit reporting agency Equifax released data showing home loan applications were down 14% in June compared to the previous year, with first homebuyer applications harder hit with a 17.2% fall.
How will banks be impacted?
More details of the major banks' home lending segments are likely to be revealed in their upcoming financial updates, due to be released next month.
Australia's biggest home lender Commonwealth Bank will deliver its full-year results on 12 August.
It has so far not revealed the extent or impact of falling home lending on its business.
Market analysts are expecting all banks to report falling margins on the back of faltering mortgage growth.
Some banks and lenders have responded to plunging mortgage demand by lowering home loan interest rates in a bid to attract what business there is in the market.
Last week, NAB cut its one- and two-year fixed home loan rates.
Last month, Macquarie Bank sliced up to 50 basis points off its fixed rates while ANZ also adjusted some select fixed rates lower.
This week, two of Australia's biggest non-bank lenders tried a different tack, extending their maximum home loan amounts in a bid to attract business in a flailing market.
Other banks have turned to their deposit products to bring some cash in the door to offset slowing home loan revenue.
This week, online bank ING launched a new savings product with a market-high introductory rate of 6.00% p.a.
Last week, AMP Bank adjusted the interest rate tiers on its successful GO Save digital savings product, likely in a bid to keep some funds within the bank.
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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 | Home Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Repayment type | Rate Type | Offset | Redraw | Ongoing Fees | Upfront Fees | Max LVR | Lump Sum Repayment | Extra Repayments | Split Loan Option | Tags | Features | Link | Compare | Promoted Product | Disclosure |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
5.94% p.a. | 5.98% p.a. | $2,978 | Principal & Interest | Variable | $0 | $530 | 90% |
| Promoted | Disclosure | ||||||||||
5.89% p.a. | 5.80% p.a. | $2,962 | Principal & Interest | Variable | $0 | $0 | 80% |
| Promoted | Disclosure | ||||||||||
5.99% p.a. | 5.95% p.a. | $2,995 | Principal & Interest | Fixed | $0 | $0 | 60% |
| Promoted | Disclosure | ||||||||||
5.93% p.a. | 5.93% p.a. | $2,975 | Principal & Interest | Variable | $0 | $395 | 70% | Disclosure |
