Non-majors take bigger slice of the market

by Julia Corderoy27 Aug 2014
The residential mortgage market in Australia is worth $1.23 trillion, so it is no wonder the banks will compete fiercely for their piece of the pie, and recent data shows non-majors are taking a larger share.  

The major banks own an unrivalled share of the market, dominating 80.9% of the total residential mortgage market at June 2014, according to the latest quarterly property exposures statistics released by APRA. However, non-majors, who hold 10.6% of the housing loan market, have seen their market share jump significantly.

According to the statistics, non-major banks increased their share of the mortgage market by 16.6% in the year to June 2014 – doubling the 8.2% increase experienced by the major banks. This is in light of the ‘mortgage wars’ spurred on by the majors this year, turning the heat up on an already competitive space.    

Owner-occupied loans accounted for 66.2% of the market, an increase of 7.5% on last year, while investment loans increased by 10.9% to make up 33.8% of the residential mortgage market in the year to June 2014. The average loan size was approximately $237,000, up from $230,000 last year, according to the APRA statistics.