Australians dipped into their savings in June, with household deposits falling by $12 billion – the first drop in 12 months, according to Canstar.com.au analysis of APRA’s Monthly Authorised Deposit-taking Institution (ADI) Statistics for June.
Household deposits dropped 0.74% in the month, bringing total banked savings to $1.61 trillion.
A June drop isn’t unusual, as households typically spend on tax-deductible items, super contributions, charity donations, and end-of-financial-year sales. Last year followed a similar pattern, with a $11.5 billion dip in June rebounding to $30.8 billion in July, despite ongoing cost-of-living pressures.
“Household savings took a hit in June as people tucked into their savings in order to pay for end-of-financial-year costs,” said Sally Tindall (pictured), Canstar.com.au data insights director.
“However, we expect this dip to be temporary, despite the cost-of-living crunch, as Australians remain steadfast in building up their war chests.”
The June figures came as the market reacted to falling inflation, with fresh optimism for interest rate cuts. Economists from ANZ and CBA now expect the RBA to deliver a 25-basis-point reduction in August, potentially fuelling further momentum in residential lending.
Tindall also noted most savers are sticking with the big four banks, which hold 72% of household deposits, despite limited competitive rates.
“Most Australians are sticking with the big four to house their nest eggs, with the major banks holding 72% market share of household deposits, despite the fact that’s not where the competitive rates are,” she said.
“Westpac is the anomaly here. It still offers an ongoing savings rate of 5% – that’s rare as hens’ teeth – but you have to be aged 18 to 29, which unfortunately rules the majority of Australians out.”
While household savings dipped, residential mortgages hit a new high, with ADIs’ loan books rising $17.7 billion in June. This marks the largest monthly jump since June 2021, driven by two cash rate cuts in February and May.
Expectations of further RBA cuts are likely to support continued momentum in residential lending and property activity in the second half of 2025.
CBA led the market, with its residential home loan book climbing 6.2% to $593.7 billion in the past year and posting the largest monthly increase on record for the bank.
“The residential mortgage market went into overdrive in June, fuelled by the two cash rate cuts in February and May,” Tindall said. “This surge in residential mortgages across the banks mirrors the continued rise in property prices.
“CBA led the way in terms of growth, increasing its residential loan book by a staggering $4.7 billion in June, the highest monthly increase in dollar terms in APRA’s records for Australia’s biggest bank.
“The Commonwealth Bank has been recalibrating and diversifying its home loan offerings over the last few years. With a suite of different mortgages designed for customers, whether they’re coming from a broker or direct-to-bank via a branch or online, the new strategy appears to be working.”
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