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First home buyers down as home lending hits record high of $31 billion
Home lending has hit a record high for the sixth month in a row, with $31.06 billion of new loans approved in April.
Owner-occupiers led the charge, with the value of loans increasing by $9.48 billion or 70.1 per cent compared to the same time last year, according to seasonally-adjusted ABS data released today. This excludes refinancing.
However, the value of first-home buyer owner-occupier loans has dropped for the third month in a row, down $132 million month-on-month.
After a huge monthly surge of $878 million in March, investors have taken their foot off the gas slightly in April, increasing by just $164 million month-on-month.
New investor loans are now at the highest monthly value since June 2017, around the time of the last property market peak.
Value of new home loans approved in April
| Amount | Monthly change | Year-on-year change | |
| TOTAL | $31.06 billion | $1.10 billion 3.7% | $12.59 billion 68.2% |
| Owner-occupier | $23.00 billion | $941 million 4.3% | $9.48 billion 70.1% |
| Investor | $8.05 billion | $164 million 2.1% | $3.11 billion 63.0% |
| First home buyers (owner-occupiers) | $6.69 billion | -$132 million -1.9% | $2.52 billion 60.4% |
Source: ABS Lending Indicators April 2021, released 4 June 2021, excludes refinancing, seasonally adjusted data. Monthly change is March 2021 to April 2021, and annual change is April 2020 to April 2021.
RateCity.com.au research director, Sally Tindall, said: “The home lending market is booming but soaring property prices are beginning to squeeze out first home buyers.”
“First home buyers made a comeback during COVID, however, they’re starting to be muscled out by cashed up investors and existing owner-occupiers able to pay top dollar at auctions,” she said.
“While the value of investor loans continued to grow this month, it wasn’t at the same rapid pace we saw in March.
“Investor lending is likely to continue to increase as investors surge back into the market in pursuit of capital growth.
“Banks are moving quickly to try to cash in on the investor comeback with 41 lenders cutting investor rates in the last two months.
“Australia has just clocked up six consecutive months of record levels of home lending. The idea that we need to relax responsible lending laws to improve the flow of credit is comical,” she said.
Lenders that have moved at least one investor rate in the last two months
(5 April to 4 June 2021)
| Lenders that have cut | Lenders that have hiked | |
| Variable | 22 | 6 |
| 1 yr fixed | 13 | 7 |
| 2 yr fixed | 18 | 6 |
| 3 yr fixed | 11 | 9 |
| 4 yr fixed | 0 | 14 |
| 5 yr fixed | 2 | 13 |
Source: RateCity.com.au
Note: A number of lenders have changed multiple home loan rates.
Disclaimer
This article is over two years old, last updated on June 4, 2021. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent home loans articles.
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