Australia's housing finance market continued to strengthen through the March quarter, with Experian's latest Business Pulse Monthly report finding new mortgage funding reached $181.4 billion, 18% higher than the same period in 2025.
New home loan accounts also rose year-on-year across March, April, and May. The average loan size for owner-occupied homes held steady at $735,000 nationally, up 11.4% on the same period last year.
The strength in housing credit comes despite a softer reading on jobs. The unemployment rate held at 4.4% in June, though underemployment climbed to 6.5%, its highest level in almost two years, while youth unemployment rose to 10.7%.
Consumer confidence, meanwhile, is on the improve. Sentiment lifted for a second straight month, with essential spend up 3.1% year-on-year in May, led by increased spend on pharmaceuticals, telecommunications, and transport. Discretionary spending was also up strongly, rising 7% over the same period.
National home prices fell 0.6% in June but remain 6.1% higher than the same time last year, with Perth and Brisbane continuing to outperform softer conditions in Sydney and Melbourne.
Hardship rates on home loans and credit cards have gradually improved over the past year, but personal loans are moving the other way, with hardship levels rising to 2.1% in May.
Delinquencies tell a similar story. Personal loan delinquency rates jumped in the last two months, hitting 3.6% in May and well above seasonal highs seen in previous years. Credit card delinquencies have also shown a gradual worsening trend this year and now sit 4 basis points above where they were at the end of the first quarter, though mortgage arrears remain comparatively contained.
Brokers may see this divergence reflected in client conversations, with some borrowers reporting confidence in their financial position even as others show signs of strain on unsecured debt.
The report's spotlight section examined Buy Now, Pay Later usage one year after regulatory changes requiring providers to run credit checks. BNPL spend has climbed sharply over the past six months, with the product increasingly functioning as an entry point into credit, particularly for consumers who are new to borrowing or re-engaging after a period of inactivity.
Consumers with no recent credit activity accounted for 35% of BNPL enquiries, compared with just 13% of credit card enquiries, suggesting BNPL is playing a distinct role from mainstream lending products in the broader credit journey.
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