Lending indicators

Latest release

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

Reference period
July 2022
Released
1/09/2022
  • Next Release 4/10/2022
    Lending indicators, August 2022
  • Next Release 2/11/2022
    Lending indicators, September 2022
  • Next Release 2/12/2022
    Lending indicators, October 2022
  • View all releases

Key statistics

In July 2022 in seasonally adjusted terms, the value of new loan commitments:

  • fell 8.5% for housing
  • rose 7.7% for personal fixed term loans
  • fell 35.4% for business construction (a typically volatile series)
  • rose 40.2% for business purchase of property (a typically volatile series)

Value of new borrower-accepted loan commitments (seasonally adjusted)

 Jul-2022 ($b)Month percent change (%)Year percent change (%)
Households   
 Housing28.35-8.5-11.3
  Owner Occupier (a)19.05-7.0-15.9
  Investor (a)9.30-11.20.0
 Personal   
  Fixed term loans2.107.77.2
Businesses   
 Construction1.48-35.4-38.4
 Purchase of Property8.1840.22.5

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

Important data quality notes

Seasonal adjustment methods

In the April 2020 Lending Indicators release, the ABS advised that the method used to produce seasonally adjusted estimates would be changed from the "concurrent" method to the "forward factors" method, during the COVID-19 period. The forward factors approach is better suited to managing large movements at the end point of series and ensures that large movements do not have a disproportionate influence on the seasonal factors.

Given disruption to typical lending patterns in the wake of COVID-19 and the continuing use of a forward factors approach to seasonal adjustment, the ABS annually undertakes an extensive review of its seasonally adjusted Lending Indicators series. Similar reviews are regularly undertaken across the ABS economic statistics program. The last review was conducted in early April 2022 and its results were implemented in the April 2022 Lending Indicators release, with new static forward factors for the 12 months from this date being calculated through the review process.

The review identified a range of time series treatments to ensure that the seasonal adjustment process continues to be less influenced by the large month-to-month movements over the past two years, and more informed by seasonality before the COVID period. Revisions to most seasonally adjusted series are therefore relatively minor but larger than would be observed through the use of concurrent seasonal adjustment (which was used prior to the COVID period, with revisions progressively made each month).

Further information can be found here:

https://www.abs.gov.au/articles/methods-changes-during-covid-19-period

We will continue to monitor the effects on lending patterns from COVID-19 with a view to reverting to the concurrent adjustment method when there is no longer significant and prolonged disruption to key series. This could be as early as the second half of 2022.

Suspension of trend series

The trend series attempts to measure underlying behaviour in lending activity. In the short term, this measurement has been significantly affected by disruption to regular patterns in lending that have occurred during the COVID period, for example as potential home buyers face uncertainty about their job security. If the trend estimates in this publication were to be published without fully accounting for such irregular events, they would likely provide a misleading view of underlying lending activity.

The Lending Indicators trend series were suspended starting from March 2020. We will continue to monitor the impacts on lending patterns from COVID-19 with a view to resuming publication of trend series when sufficient certainty emerges in the underlying trends in lending. This could be as early as the second half of 2022.

Treatment of Buy Now Pay Later products in Personal finance

The ABS has identified some inconsistencies in how Buy Now Pay Later (BNPL) loan products are being reported. We are working with APRA, the Reserve Bank and lenders to ensure reporting aligns with reporting guidance and definitions, and is consistent across different lenders. Revisions to Personal finance data are expected when this is resolved.

     

Housing finance

In July 2022 in seasonally adjusted terms, the value of new loan commitments:

  • for total housing fell 8.5% to $28.4b, after a fall of 4.4% in June
  • for owner-occupier housing fell 7.0% to $19.1b but remained 39.6% higher than the pre-pandemic level seen in February 2020
  • for investor housing fell 11.2% to $9.3b but remained 78.4% higher than the pre-pandemic level seen in February 2020

In July 2022 in seasonally adjusted terms, the value of external refinancing:

  • for total housing fell 1.2% but was 7.6% higher compared to a year ago
  • for owner-occupier housing fell 1.9% but was 13.0% higher compared to a year ago. It was at its second highest level following the record high reached in June.
  • for investor housing rose 0.3% but was 3.1% lower compared to a year ago

Personal finance

In July 2022 in seasonally adjusted terms, the value of new loan commitments:

  • for total fixed term personal finance rose 7.7%, after a fall of 15.2% in June
  • for the purchase of road vehicles rose 5.2%, after a fall of 14.4% in June
  • for personal investment rose 73.8%, after a fall of 37.1% in June

Business finance

In July 2022 in seasonally adjusted terms, the value of new loan commitments:

  • for total construction finance fell 35.4%, after a rise of 7.7% in June
  • for the purchase of property rose 40.2%, after a fall of 19.4% in June. This series can have volatile month-to-month movements as it is strongly affected by small numbers of high value loans.

Housing finance (detailed)

New loan commitments by purpose (seasonally adjusted)

 Jul-2022Month percent changeYear percent change
Value($b)(%)(%)
 Owner occupier   
  Total housing (a)19.05-7.0-15.9
   Construction of dwellings2.29-5.9-13.2
   Purchase of newly erected dwellings1.10-5.2-28.1
   Purchase of existing dwellings14.31-7.4-16.1
  First home buyers4.06-9.5-32.6
 Investor   
  Total housing (a)9.30-11.20.0
    
Number(No.)(%)(%)
 Owner occupier   
  Total housing (a) (b)   
   Construction of dwellings4 144-6.6-25.0
   Purchase of newly erected dwellings1 9481.9-29.9
   Purchase of existing dwellings23 324-6.3-19.9
  First home buyers8 388-10.7-35.9
 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 July 2022 in seasonally adjusted terms, the value of new loan commitments:

  • to owner-occupiers fell 7.0%, after a fall of 3.3% in June
  • to investors fell 11.2%, after a fall of 6.3% in June

  

In July 2022 in seasonally adjusted terms for owner-occupier housing, the value of new loan commitments:

  • for the purchase of existing dwellings fell 7.4% and was 16.1% lower compared to a year ago
  • for the construction of new dwellings fell 5.9% and was 13.2% lower compared to a year ago
  • for the purchase of new dwellings fell 5.2% and was 28.1% lower compared to a year ago

(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 July 2022 in seasonally adjusted terms for owner-occupier housing, the value of new loan commitments:

  • in Queensland fell 9.6%, in Victoria fell 6.0%, in New South Wales fell 5.5%, in Western Australia fell 7.2%, in South Australia fell 10.1%, in the Australian Capital Territory fell 3.3% and in Tasmania fell 1.8%
  • in the Northern Territory (a smaller and typically more volatile series) rose 3.1%

  

In July 2022 in seasonally adjusted terms for investor housing, the value of new loan commitments:

  • in Victoria fell 14.4%, in New South Wales fell 7.5%, in Queensland fell 12.6%, in Tasmania (a smaller and typically more volatile series) fell 21.9%, in the Australian Capital Territory fell 7.1% and in the Northern Territory fell 6.3%
  • in South Australia rose 3.2% and in Western Australia rose 0.4%

In July 2022, in original terms:

  • the value of new variable rate loan commitments funded in the month fell 9.7%
  • the value of new variable rate loan commitments to first home buyers funded in the month fell 15.3%
  • the value of new fixed rate loan commitments funded in the month fell 48.3%
  • the value of new fixed rate loan commitments to first home buyers funded in the month fell 41.5%

*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

In July 2022 in original terms, average loan sizes for owner-occupier dwellings (which includes construction and the purchase of new and existing dwellings):

  • fell slightly by 0.1% at the national level from $610k to $609k
  • fell in the Australian Capital Territory, Western Australia, New South Wales, Queensland and South Australia
  • rose in all other states

In seasonally adjusted terms at the national level, the value of owner-occupier dwelling commitments fell 7.1% while the number of these commitments fell 5.8%.

*Please note that while the series graphed above are joined between the available data points, there may be missing data points in between which are not available for publication

First home buyers

In July 2022 in seasonally adjusted terms for owner-occupier first home buyers, the number of new loan commitments:

  • fell 10.7% at the national level and was 35.9% lower compared to a year ago. This was below the pre-pandemic level seen in February 2020.

  • in Queensland fell 18.8%, in Victoria fell 12.6%, in New South Wales fell 11.6%, in Western Australia fell 5.4%, in South Australia fell 8.6%, in the Australian Capital Territory fell 11.3% and in Tasmania fell 12.1%

  • in the Northern Territory remained the same as the previous month

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

  First home buyer loan commitments
Number
First home buyer ratio
Dwellings (a)
First home buyer ratio
Housing (b)
Total Australia 8 099 28.5% 24.0%
 New South Wales 1 837 25.2% 20.9%
 Victoria 2 602 31.7% 27.0%
 Queensland 1 528 26.0% 21.5%
 South Australia 445 21.5% 18.4%
 Western Australia 1 213 35.4% 31.4%
 Tasmania 147 28.2% 22.1%
 Northern Territory 67 28.0% 24.1%
 Australian Capital Territory 260 32.4% 29.1%

(a) Dwellings includes loan commitments for construction of dwellings, purchase of newly erected dwellings and purchase of existing dwellings.

(b) Housing includes loan commitments for dwellings, purchase of residential land and for alterations and additions.

  

Data downloads

Housing Finance - Total

Data files

   

Housing Finance - Owner-occupiers

Data files

   

Housing Finance - Investors

Data files

  

Housing Finance - First home buyers

Data files

    

Table 26. Households; Housing finance; Non-residents; New loan commitments; Numbers and values

   

Personal Finance

Data files

   

Business Finance

Data files

Data cubes

Series ID concordance mapping

Previous catalogue number

This release previously used catalogue number 5601.0.

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