Notable decline in new home lending

by Madison Utley14 Mar 2019

Figures recently released by the Australian Bureau of Statistics (ABS) show that in the past year, new lending to households has taken the sharpest annual dive in over a decade.

"Reflecting the impact of both supply and demand side factors, new lending for dwellings is down over 20% from January 2018, the largest through the year decline since late 2008,” explained ABS chief economist Bruce Hockman.

New lending commitments to households dropped 2.4% in January of this year, following a 3.6% decrease in December 2018. Compared to January 2018, new lending is down 16% seasonally adjusted.

Hockman said, "Weaker lending for dwellings (-2.1%) again drove much of the overall fall in lending to households, with further falls in lending for investment dwellings (-4.1%) and for owner occupier dwellings (-1.3%) in January."

Queensland and the Northern Territory were the only two states or territories not to exhibit a decline in lending activity in January. Loans to first home buyers (FHB) fell, but not as much as the 3.2% decline in loans for owner occupier non-first home buyers.

The only household lending category to record a rise in January was lending for personal finance, up 1.2%.


  • by refi 14/03/2019 7:21:35 AM

    When the need to buy property diminishes then obviously demand for mortgages evaporates.

    And there is likely a large pool of existing borrowers that cannot refinance because of affordability issues and property price decreases.

  • by SEQ Broker 15/03/2019 2:50:16 PM

    Call me Cynical. But a person who calls for a royal commission from a bank possibly knows what mat happen. A downward bubble trapping home owners in their current situations. Causing the competition to go out of business. Then gets a giant boon from Mr Hayne..

    Hmmm Cynical.