Housing loan commitments fell 3.4 per cent in August

4 October 2022

The value of new loan commitments for housing fell 3.4 per cent to $27.4 billion in August 2022 (seasonally adjusted), after a fall of 8.5 per cent in July, according to data released today from the Australian Bureau of Statistics (ABS).

Katherine Keenan, head of Finance and Wealth at the ABS, said: “The value of new owner-occupier loan commitments fell 2.7 per cent in August 2022, and the value of new investor loan commitments fell 4.8 per cent.

“Although lending continued to fall from the high levels of June 2022, the value of loan commitments in August remained elevated compared to pre-pandemic levels. Owner occupier loans in August were 36 per cent higher than February 2020, while investor loans were 70 per cent higher.”

The number of new loan commitments to owner-occupier first home buyers rose 10.4 per cent in August 2022 to 9,258. This was the largest rise since August 2020, although the level remained well below the January 2021 high of 16,330. Increased demand was seen across almost all states and territories, particularly in Victoria (up 11.9 per cent), Queensland (up 14.3 per cent) and Western Australia (up 13.9 per cent).

“Anecdotal feedback attributed some of the August owner-occupier first home buyer increased demand to the 2022-23 First Home Guarantee,” Ms Keenan said.

The value of borrower refinancing of owner-occupier housing loan commitments between lenders rose 2.8 per cent in August 2022 to a new record high of $12.8 billion. Borrowers continued to seek loans with lower interest rates amid an increase in the RBA cash rate in August.

At the national level, the average loan size for owner-occupier dwellings (which includes construction and the purchase of new and existing dwellings) fell in August from $609,000 to $589,000, though it remained 23 per cent higher than that seen in February 2020. Average loan sizes fell in every state, however rose slightly in both territories.

The value of new loan commitments for fixed term personal finance rose 9.5 per cent (seasonally adjusted) in August 2022. Lending for the purchase of road vehicles rose 17.7 per cent following a 5.2 per cent rise in July, recovering to previous levels after a sharp fall in June.

In August 2022 in seasonally adjusted terms, the value of new loan commitments:

  • for total construction finance rose 51.7%, after a fall of 35.4% in July
  • for the purchase of property fell 23.6%, after a rise of 40.2% in July

In August 2022 in seasonally adjusted terms for owner-occupier housing, the value of new loan commitments:

  • in New South Wales fell 8.5%, in Victoria fell 2.9%, in South Australia fell 3.8% and in Queensland fell 0.4%
  • in Western Australia rose 7.2%, in the Australian Capital Territory rose 6.6%, in Tasmania rose 8.3% and in the Northern Territory rose 7.0%