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Refinancing halts freefall yet fixed rates hit rock bottom
The value of refinanced home loans staged a small comeback in February, with ABS Lending Indicator data recording a $478 million bump.
After six consecutive months of drops, the increase of 3 per cent marks the first tine refinancing has grown since July 2023, however, the value of externally refinanced loans is now almost a quarter lower than it was at its peak last July.Since the start of the hikes, ABS data shows that $411.58 billion worth of loans has been refinanced in total.
Value of loans refinanced in February
| Amount | Monthly change | Change since peak (Jul 2023) | Total refinanced since start of hikes (May 22 – Feb 24) |
| $16.55 billion | +$478 million +3.0% | -$4.95 billion -23% | $411.58 billion |
Source: ABS lending indicators, seasonally adjusted data.
Value of external refinancing - last 12 months
Source: ABS Lending Indicators, seasonally adjusted data
Fixing drops to new record low
After two months of small rises, the proportion of new and refinanced loans opting for a fixed rate has dropped to a new record low of just 1.4 per cent.
This is despite the fact that around half of the lenders on the RateCity.com.au database have cut at least one fixed rate since the start of the year.
Fixed vs variable: proportion of new and refinanced loans
Source: ABS Lending Indicators, original data. Based on the value of new and refinanced loans in the month.
New lending increase driven by owner-occupiers in February
The total value of new home loans approved rose by 1.5 per cent in the month of February in seasonally adjusted terms – the first rise since November of last year. This rise was driven by owner-occupier loans which increased by $269 million (1.6%) from the previous month.
Growth in investor lending was slightly more subdued with a 1.2 per cent increase from the previous month. However, looking over the past year, the value of investor lending has increased by a notable 21.5 per cent when compared to February 2023.
Value of new home loans approved in February 2024
| Value | Monthly change | Year-on-year change | |
| TOTAL | $26.40 billion | +$384.1 million +1.5% | +$3.10 billion +13.3% |
| Owner-occupier | $16.87 billion | +$269.2 million 1.6% | +$1.41 billion +9.1% |
| Investor | $9.53 billion | +$114.9 million +1.2% | +$1.68 billion +21.5% |
Source: ABS Lending Indicators Feb 2024, released 8 Apr 2024, seasonally adjusted data.
First home buyers
The value of first home buyer home loans increased by 4.8 per cent compared to the previous month, and 20.7 per cent compared to the same period last year.
Number of new owner-occupier first home buyer loans in February
| Amount | Monthly change | Year-on-year change | |
| Number of loans | 9,377 | +385 4.3% | +1,094 +13.2% |
| Value of loans | $4.93 billion | +$224.8 million +4.8% | $844.3 million +20.7% |
Source: ABS Lending Indicators February 2024, released 8 Apr 2024, seasonally adjusted data.
Big banks exert their market dominance
The proportion of new loans approved by the major banks has risen in recent months, with a total of 75.3 per cent of new loans opting for a big four bank in the month of February. This is up from 69.2 per cent just before the start of the rate hikes in February 2022. Note this excludes refinanced loans and is original data.
Big four bank proproation of new loans approved per month
Source: ABS Lending Indicators Feb 2024, released 8 Apr 2024, original data.
New loan commitments, by lender type
Source: ABS Lending Indicators Feb 2024, released 8 Apr 2024, original data.
New loan sizes stabilise
Average new owner-occupier loan sizes largely cooled across the country, after we saw recent record highs in several states.
NSW saw the biggest drop, month-on-month, with the new average loan size dropping by 6.4 per cent – or $49,315 – to $721,599.
The ACT saw a significant jump of $46,758 in average new loan size compared to the previous month, and $32,090 more than since before the hikes.
Average new loan sizes - owner-occupier mortgages
| Av. new loan size | Monthly change | Change since hikes | |
| (April 22 – Feb 2024) | |||
| Australia | $598,624 | -$16,554 -2.7% | -$12,530 -2.1% |
| NSW | $721,599 | -$49,315 -6.4% | -$64,436 -8.2% |
| VIC | $603,142 | -$10,946 -1.8% | -$34,126 -5.4% |
| QLD | $561,625 | +$2,118 +0.4% | +$34,173 +6.5% |
| SA | $500,934 | -$29,342 -5.5% | +$33,649 +7.2% |
| WA | $506,004 | -$24,294 -4.6% | +$34,515 +7.3% |
| TAS | $437,079 | +$2,190 +0.5% | -$10,699 -2.4% |
| NT | $429,496 | +$7,353 +1.7% | +$2,984 +0.7% |
| ACT | $628,411 | +$46,758 +8.0% | +$32,090 +5.4% |
Source: ABS Lending Indicators Feb 2024, released 8 Apr 2024, seasonally adjusted data.
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Product database updated 30 Apr, 2024
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