Mortgage enquiries have fallen for the eighth consecutive quarter continuing a "steady bottoming out" seen since the GFC.
Veda's Consumer Credit Demand Index has shown that demand for credit still remains low. Overall credit demand remained flat for 2011, with demand for home loans and credit cards continuing to fall.
Veda head of consumer risk Angus Luffman said the result for the final quarter of 2011 was surprising, with the holiday season failing to ignite demand for credit.
"To see such a marked reduction in the use of credit by consumers in the period leading up to the Christmas holidays is unusual; the final quarter of the year is typically a time when there is stronger demand from consumers to obtain new credit," Luffman said.
The quarterly fall in mortgage enquiries saw home loan demand finish the year nearly 10% below 2010 levels. The decline was seen across all states except NSW, where the market was bolstered by a rush of first homebuyers at the latter part of the year.