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Lending indicators

This release is about new borrower-accepted finance commitments for housing, personal and business loans

Reference period
January 2021
Released
1/03/2021

Key statistics

In January 2021, new loan commitments (seasonally adjusted):

  • rose 10.5 per cent for housing
  • rose 0.2 per cent for personal fixed term loans
  • fell 32.9 per cent for business construction (typically a volatile series)

New borrower-accepted loan commitments (seasonally adjusted)

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Jan-21 ($b)Month percent change (%)Year percent change (%)
Households   
 Housing28.7510.544.3
  Owner occupier (a)22.1110.952.3
  Investor (a)6.649.422.7
 Personal   
  Fixed term loans1.780.2-0.1
Businesses   
 Construction1.43-32.9-32.9
 Purchase of property4.00-25.7-12.5

(a) Loan commitments for owner occupier, investor housing and personal fixed term loans exclude refinancing.

 

Important data quality note

Economic and Financial Statistics (EFS) collection

From July 2019 onwards, data in this publication has been sourced from the Economic and Financial Statistics (EFS) collection, a new and improved data source collected by APRA on behalf of the ABS and RBA. There have been extensive and ongoing discussions with lenders about the EFS collection. Data quality is expected to continue to improve over time, as lenders become accustomed to the new reporting basis and further refine the data they report. This process is likely to lead to revisions, including to the historical time series - see below for further details.

Upcoming revisions

The March 2021 issue of Lending Indicators is expected to include revisions to previously published statistics about housing loan commitments. Specifically, the revisions will correct for over-reporting of external refinancing during 2020. Total housing and its major sub-purpose components will remain largely unchanged. The revisions are not expected to affect the interpretation of movements in the published statistics

Lender type breakdowns

Lender type breakdowns for Major banks, Other Authorised Deposit-taking Institutions (ADIs) and Non-ADIs are only available in this publication from July 2019 onwards. It is likely that more information about lender-type breakdowns will become available in the coming months.

Suspension of trend series

The trend series attempts to measure underlying behaviour in lending activity. In the short term, this measurement will be significantly affected by changes to regular patterns in lending that will occur during this time, as potential home buyers face uncertainty about their job security, for example. If the trend estimates in this publication were to be calculated without fully accounting for this irregular event, they would likely provide a misleading view of underlying lending activity.

It may be some time before the underlying trend in lending activity can be accurately estimated. The Lending Indicators trend series have therefore been suspended starting from March 2020. The trend series will be reinstated when more certainty emerges in the underlying trend in lending.

Update to seasonal adjustment methods

Lending Indicators uses the concurrent seasonal adjustment method, meaning that seasonal factors are re-estimated each time a new data point becomes available. If not appropriately accounted for, unusual real-world events, such as COVID-19, can distort estimates calculated using this method. From April 2020, seasonal factors are being calculated using data up to and including March 2020, then projected from April 2020 onwards. This approach, known as the forward factor method, ensures that the seasonal factors are not distorted by COVID-19 impacts.

     

Housing finance

In seasonally adjusted terms, in January 2021:

  • The value of new loan commitments for housing rose 10.5 per cent, a 44.3 per cent rise through the year
  • The value of new loan commitments to owner occupiers rose 10.9 per cent, a 52.3 per cent rise through the year
  • The value of new loan commitments to investors rose 9.4 per cent, a 22.7 per cent rise through the year
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Personal finance

In seasonally adjusted terms, in January 2021:

  • The value of new loan commitments for fixed term personal lending rose 0.2 per cent
  • The value of new loan commitments for road vehicles fell 3.3 per cent
  • The value of new loan commitments for other purposes rose 15.8 per cent
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Business finance

In seasonally adjusted terms, in January 2021:

  • The value of new loan commitments for construction fell 32.9 per cent
  • The value of new loan commitments for purchase of property fell 25.7 per cent
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Housing finance (detailed)

New loan commitments by purpose (seasonally adjusted)

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Jan-2021Month percent changeYear percent change
Value($b)(%)(%)
 Owner occupier   
      Total housing (a)22.1110.952.3
  Construction of dwellings4.0715.7141.0
  Purchase of newly erected dwellings1.462.434.0
  Purchase of existing dwellings14.9512.538.7
      First home buyers7.1610.173.2
 Investor   
      Total housing (a)6.649.422.7
Number(No.)(%)(%)
 Owner occupier   
      Total housing (a) (b)---
  Construction of dwellings 9 85820.3161.8
  Purchase of newly erected dwellings 2 8882.228.6
  Purchase of existing dwellings27 40710.829.8
      First home buyers16 6649.670.8
 Investor   
      Total housing (a) (b)---

(a) Housing includes loan commitments for dwellings, purchase of residential land and for alterations and additions.
(b) There is no seasonally adjusted or trend data available for the number of owner occupiers or investors for total housing as the data was collected from July 2019.

 

In seasonally adjusted terms, in January 2021:

  • The value of new loan commitments to owner occupiers rose 10.9 per cent, the largest monthly rise since August 2020
  • The value of new loan commitments for investor housing rose 9.4 per cent, the largest rise since September 2016, to reach $6.6 billion. Investor lending has rebounded 62.4 per cent since May 2020, when it reached its lowest level since December 2002
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In seasonally adjusted terms, in January 2021:

  • The value of new loan commitments for the purchase of existing dwellings rose 12.5 per cent
  • The value of new loan commitments for the construction of new dwellings rose 15.7 per cent.
  • Since the HomeBuilder grant was introduced in June 2020, there have been record rises in the value of construction loan commitments. Loan applications made late in 2020 (prior to the reduction of the HomeBuilder grant on 1 January 2021), contributed to the strong rise in January’s construction loan commitments
  • The value of new loan commitments for the purchase of new dwellings rose 2.4 per cent
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(a) For periods prior to July 2019, statistics about owner occupier commitments for residential land are modelled using data about the total value of  commitments for residential land.

* Hide/unhide series in the graph by clicking the legend above (toggle the 'purchase of existing dwellings' series for a closer look at the other purposes of owner occupier lending).

 

In seasonally adjusted terms, in January 2021:

  • The value of owner occupier home loan commitments rose across all states and territories and, with the exception of the Northern Territory, is at record high levels across Australia
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In seasonally adjusted terms, in January 2021:

  • The value of new loan commitments to investors rose 12.9 per cent in Victoria
  • The value of new loan commitments to investors rose 6.7 per cent in New South Wales
  • The value of new loan commitments to investors rose 5.5 per cent in Queensland
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In original terms, in January 2021:

  • The value of new variable rate loan commitments funded in the month fell 20.4 per cent
  • The value of new fixed rate loan commitments funded in the month fell 12.8 per cent
  • The value of new variable rate loan commitments to first home buyers funded in the month fell 21.7 per cent
  • The value of new fixed rate loan commitments to first home buyers funded in the month fell 11.0 per cent
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*A loan is considered funded once any portion of the funds is made available for the borrower to draw down according to the terms of the contract. This will occur after there is a borrower-accepted commitment to provide finance.

**Total Fixed rate and Total Variable rate housing loans include first home buyer loans

First home buyers

In January 2021

  • The number of owner occupier first home buyer loan commitments rose 9.6 per cent to reach 16,664, a 70.8 per cent rise from January 2020. This is now at its highest level since May 2009, when similar rapid growth was spurred by the temporary tripling of the first home owner grant in response to the global financial crisis
  • the number of first home buyer loan commitments for investment purposes accounted for 4.4 per cent of all first home buyer commitments, in original terms
  • owner occupier first home buyer loan commitments accounted for 36.5 per cent of all owner occupier commitments (excluding refinancing), in original terms

 

Additional information

Previously, the ABS published a first home buyer ratio which was the ratio of owner occupier first home buyer loan commitments to all owner occupier loan commitments. The table below presents two owner occupier first home buyer ratios.

  • The first ratio is the ratio of first home buyer loan commitments to total dwelling commitments (excluding refinancing). This is similar to the ratio published prior to October 2019. Loan commitments for dwellings is the sum of loan commitments for construction of dwellings, newly erected dwellings and existing dwellings. 
  • The second ratio is a new ratio, the ratio of first home buyer loan commitments to total housing loan commitments (excluding refinancing). This ratio uses the new key statistic, total housing loan commitments. Total housing loan commitments is the sum of loan commitments for dwellings and loan commitments for purchases of residential land and alterations and additions. 

First home buyer ratios should be used with caution because the direction of movements in the ratio are often not indicative of the direction of movement in the number of first home buyers. First home buyer ratios are no longer routinely published by the ABS in the time series spreadsheets. 

The table below does not include first home buyer loan commitments for investors. Information about the number of loan commitments for investors is new and is separately presented in a graph below.

  

New loan commitments to owner occupier first home buyers (original), number

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 First home buyer loan commitmentsFirst home buyer ratioFirst home buyer ratio
 NumberDwellingsHousing
Total Australia13 87841.6%36.5%
 New South Wales 2 71735.0%30.9%
 Victoria 4 36946.0%39.8%
 Queensland 3 04841.4%36.2%
 South Australia 81734.9%29.9%
 Western Australia 2 32850.7%45.5%
 Tasmania 23332.9%28.0%
 Northern Territory 9948.3%43.6%
 Australian Capital Territory 26731.3%29.1%
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Data downloads

Time series spreadsheets

Data files

Data cubes

Series ID concordance mapping

Previous catalogue number

This release previously used catalogue number 5601.0.