Home lending hits new high as established homes get boost from owner occupiers
![Woman looking at homes](https://cdn.mozo.com.au/images/atwood/12372/woman%20looking%20at%20homes.jpg)
Despite skyrocketing house prices, home buyer demand hasn’t faltered at all but the types of Australians joining the market are changing.
As the latest Australian Bureau of Statistics (ABS) data reveals, new home loan commitments hit another record high last month, rising by 3.7% to $31 billion.
Owner occupiers continued to make up the bulk of those new home loans, contributing to $23 billion or nearly three-quarters of the total amount committed in April. This figure is up 4.3% from March.
ABS’s head of finance and wealth, Katherine Keenan said the rise in owner occupier lending is a result of increased loan commitments for existing dwellings, which surged 9.2% last month. In other words, with the HomeBuilder grant expiring, owner occupiers are increasingly shifting their focus from newly constructed homes back to established homes.
“Loan commitments to owner occupiers for the construction of new dwellings fell by 11.4 per cent [in April], following a fall of 14.8 per cent in March. These were the first monthly declines since the Homebuilder grant was introduced in June 2020,” Keenan said.
“However, the value of construction commitments remained at a high level.”
A growing number of investors also came out of ‘hibernation’ after a lull in participation last year. New loan commitments for this borrower group jumped by 2.1% to $8.1 billion in April - the highest level since mid-2017.
RELATED: Does a 3-year lending high signal the return of property investors?
On the flipside, the number of first home loans fell for the third month running to 15,171, in part because more and more first home buyers are being shut out of the market by high prices and low supply. But the ABS notes that first loan commitments are still at a 12-year peak despite this decline.
Why are home lending values so high?
While strong home lending figures indicate an overheated property market with lots of buyer interest, that’s not the only factor to consider in this equation.
There is also a trend of home buyers now having to borrow more money from the lender to afford property, which pushes up the value of new home loan commitments too.
Mozo’s number crunch, for instance, reveals that the average new home loan size for owner occupiers last month exceeded $500,000 for the first time in the ABS series, sitting at $504,859. One year ago, the average loan was $58,087 smaller.
Besides this, competitive interest rates continue to be a huge incentive for many home buyers. Thanks to the Reserve Bank’s decision to hold the official cash rate at a record low 0.10% for seven months now, lenders have also kept their rates fairly low.
Here’s a snapshot of average rates in the Mozo database for owner occupiers as of 7 June 2021, compared to two years ago:
Loan Type | June 2021 | June 2019 | Difference |
Variable | 3.24% | 4.31% | -1.07% |
1-year fixed | 2.33% | 3.96% | -1.63% |
2-year fixed | 2.27% | 3.85% | -1.58% |
3-year fixed | 2.31% | 3.91% | -1.60% |
4-year fixed | 2.50% | 4.33% | -1.83% |
5-year fixed | 2.72% | 4.32% | -1.60% |
For a more detailed look at home loan rates and trends, check out our home loan statistics page. Or if you’re ready to shop around for a great deal, head on over to our home loans comparison hub to get started today.
Home loan comparisons on Mozo
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Unloan Variable
- Owner Occupier
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- Interest rate
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5.99
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- Comparison rate
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5.90
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- Initial monthly repayment
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$2,995
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5.99
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5.90
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- Upfront fees
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$0
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$0.00
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$0.00
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yes - free
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no
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6.14
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6.16
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$3,043
Enjoy a low rate home loan with $0 application fee and $0 ongoing fees. Flexibility to split your loan and set different repayment types. Fee free redraw from your loan using online banking. Flexible ways to repay. 40% Deposit required.
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6.14
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$350
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$0.00
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6.09
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6.11
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$3,027
Competitively-priced variable rate loan. Ideal for owner occupiers and investors. No service fees to pay. Make free extra repayments and redraws. Flexible repayment schedule available.
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6.09
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$250
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$0.00
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$300.00
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6.09
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6.13
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$3,027
Refinancers or first home buyers pay no monthly or annual fees. Up to $3,000 cashback when you complete your home loan application online. $2,000 cashback on loans ≥$250K; or $3,000 cashback on loans ≥$500K. LVR ≤80%. T&Cs and credit criteria apply.
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6.09
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6.13
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$595
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$0.00
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$250.00
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yes - fees apply
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5.69
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6.34
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$2,899
Lock in a competitive interest rate and enjoy peace of mind for the fixed period. Available for owner occupied new and refinanced home loans with at least 20% deposit. Split option available as well as offset and redraw. Noapplication, ongoing or banking fees. Third Party fees may be applicable - payable within loan repayments. Extra repayments up to $20K per annum permitted. Apply online, 100% member owned credit union.
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5.69
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6.34
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$0
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$0.00
- Discharge fee
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no
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Unloan Variable
- Owner Occupier
- LVR <80%
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5.99
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5.90
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p.a.
- Initial monthly repayment
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$2,995
Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for borrowers. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.
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5.99
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5.90
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p.a.
- Upfront fees
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$0
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$0.00
- Discharge fee
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$0.00
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yes - free
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yes - free
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no
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- 80.00%
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- $10,000
- Maximum borrowing amount
- $10,000,000
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OMG Home Loan
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5.99
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$2,995
BCU Bank’s OMG owner occupied home loan offers a variety of great low rates depending on your deposit. Save with no ongoing annual fees. Access your extra payments when you need to through the redraw facility. Pre-approval valid for 3 months.
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$300
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$0.00
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$395.00
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no
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5.99
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6.34
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$2,995
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5.99
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6.34
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$250
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$300.00
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yes - free
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yes - free
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yes
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6.01
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6.14
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$3,001
Get online approval from the award-winning Bendigo Bank Express Home Loan. Multiple offset accounts and redraw available. 100% offset on variable rate loans and partial offset on fixed rate. Flexible repayment options. New home loans only.
- Interest rate
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6.01
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6.14
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- Upfront fees
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$134
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$10.00 monthly
- Discharge fee
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$350.00
- Extra repayments
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yes - free
- Redraw facility
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yes - free
- Offset account
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yes
- Maximum loan to value ratio
- 90.00%
- Minimum borrowing amount
- $5,000
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- $3,000,000
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Neat Home Loan
- Owner Occupier
- Principal & Interest
- LVR <60%
- Interest rate
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6.09
%
p.a.
Variable
- Comparison rate
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6.11
%
p.a.
- Initial monthly repayment
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$3,027
Competitively-priced variable rate loan. Ideal for owner occupiers and investors. No service fees to pay. Make free extra repayments and redraws. Flexible repayment schedule available.
- Interest rate
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6.09
%
p.a.
Variable
- Comparison rate
-
6.11
%
p.a.
- Upfront fees
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$250
- Ongoing fees
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$0.00
- Discharge fee
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$300.00
- Extra repayments
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yes - free
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yes - free
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no
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- 60.00%
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- $80,000
- Maximum borrowing amount
- $5,000,000
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Special Real Deal Home Loan
- Owner Occupier
- Principal & Interest
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- Interest rate
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6.09
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p.a.
Variable
- Comparison rate
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6.13
%
p.a.
- Initial monthly repayment
-
$3,027
Refinancers or first home buyers pay no monthly or annual fees. Up to $3,000 cashback when you complete your home loan application online. $2,000 cashback on loans ≥$250K; or $3,000 cashback on loans ≥$500K. LVR ≤80%. T&Cs and credit criteria apply.
- Interest rate
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6.09
%
p.a.
Variable
- Comparison rate
-
6.13
%
p.a.
- Upfront fees
-
$595
- Ongoing fees
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$0.00
- Discharge fee
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$250.00
- Extra repayments
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yes - free
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yes - fees apply
- Offset account
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no
- Maximum loan to value ratio
- 80.00%
- Minimum borrowing amount
- $150,000
- Maximum borrowing amount
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- Type of mortgage
- Variable
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Basic Home Loan
- Owner Occupier
- LVR<60%
- Principal & Interest
- Interest rate
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6.14
%
p.a.
Variable
- Comparison rate
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6.16
%
p.a.
- Initial monthly repayment
-
$3,043
Enjoy a low rate home loan with $0 application fee and $0 ongoing fees. Flexibility to split your loan and set different repayment types. Fee free redraw from your loan using online banking. Flexible ways to repay. 40% Deposit required.
- Interest rate
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6.14
%
p.a.
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- Comparison rate
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6.16
%
p.a.
- Upfront fees
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$350
- Ongoing fees
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$0.00
- Discharge fee
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$400.00
- Extra repayments
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yes - free
- Redraw facility
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yes - free
- Offset account
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no
- Maximum loan to value ratio
- 60.00%
- Minimum borrowing amount
- $150,000
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Flex Home Loan
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6.14
%
p.a.
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6.38
%
p.a.
- Initial monthly repayment
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$3,043
Competitive variable rate. Multiple offset accounts available. Borrowers can also make extra repayments. Redraw facility available. Simple online application process. 40% deposit required.
- Interest rate
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6.14
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p.a.
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6.38
%
p.a.
- Upfront fees
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$250
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$250.00 yearly
- Discharge fee
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$300.00
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yes - free
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yes - free
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yes
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Offset Home Loan
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6.14
%
p.a.
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6.39
%
p.a.
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$3,043
Ability to open up to 10 offset accounts per loan account. Fast online application. Linked Debit Mastercard® with fee-free access at ATMs across Australia. Package a credit card with your home loan and the annual card fee will be waived (T&Cs apply). 40% deposit required.
- Interest rate
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6.14
%
p.a.
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6.39
%
p.a.
- Upfront fees
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$350
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$248.00 yearly
- Discharge fee
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$400.00
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yes - free
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yes - free
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yes
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- $150,000
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Basic Home Loan
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6.25
%
p.a.
Fixed 3 years
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6.20
%
p.a.
- Initial monthly repayment
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$3,079
No upfront or ongoing fees. Free extra repayments and redraw facility. Option to earn Qantas points. Min 30% deposit required. Borrow up to $10,000,000.
- Interest rate
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6.25
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p.a.
Fixed 3 years
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6.20
%
p.a.
- Upfront fees
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$350
- Ongoing fees
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$0.00
- Discharge fee
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$400.00
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yes - up to $10,000 p.a.
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yes - free
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no
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- $150,000
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Offset Home Loan
- Fixed
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- Principal & Interest
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6.25
%
p.a.
Fixed 3 years
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6.42
%
p.a.
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$3,079
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6.25
%
p.a.
Fixed 3 years
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6.42
%
p.a.
- Upfront fees
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$350
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$248.00 yearly
- Discharge fee
-
$400.00
- Extra repayments
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yes - up to $10,000 p.a.
- Redraw facility
-
yes - free
- Offset account
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yes
- Maximum loan to value ratio
- 70.00%
- Minimum borrowing amount
- $150,000
- Maximum borrowing amount
- $10,000,000
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Fixed Rate
- Owner Occupier
- Principal & Interest
- <80% LVR
- Interest rate
-
6.54
%
p.a.
Fixed 2 years
- Comparison rate
-
7.10
%
p.a.
- Initial monthly repayment
-
$3,174
Enjoy up to $3000 cashback for eligible first home buyers and $2000 cashback for refinancers on eligible home loans with the ANZ Fixed Rate Home Loan. Get the security of repayment certainty with a competitive locked in rate. No ongoing fees to pay. Offset account on 1-year fixed loans ($10/month fee applies). Interest-only payments allowed.
- Interest rate
-
6.54
%
p.a.
Fixed 2 years
- Comparison rate
-
7.10
%
p.a.
- Upfront fees
-
$160
- Ongoing fees
-
$0.00
- Discharge fee
-
$160.00
- Extra repayments
-
yes - free up to to lesser of 5% of original fixed loan amount, or $5,000 each year
- Redraw facility
-
no
- Offset account
-
Optional - $10 per month - 1 year fixed term only
- Maximum loan to value ratio
- 80.00%
- Minimum borrowing amount
- $20,000
- Maximum borrowing amount
- -
- Type of mortgage
- Fixed
- Repayment types
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* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.
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