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Lending indicators

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

Reference period
October 2021
Released
2/12/2021
  • Next Release 14/01/2022
    Lending indicators, November 2021
  • Next Release 1/02/2022
    Lending indicators, December 2021
  • Next Release 1/03/2022
    Lending indicators, January 2022
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Key statistics

In October 2021 in seasonally adjusted terms, new loan commitments:

  • fell 2.5% for housing
  • rose 4.7% for personal fixed term loans
  • rose 3.6% for business construction (typically volatile series)

New borrower-accepted loan commitments (seasonally adjusted)

 Oct-2021 ($b)Month percent change (%)Year percent change (%)
Households   
 Housing29.57-2.532.2
  Owner Occupier (a)19.84-4.115.1
  Investor (a)9.731.189.6
 Personal   
  Fixed term loans2.034.727.4
Businesses   
 Construction2.513.621.9
 Purchase of PropertyNPNPNP

(a) Loan commitments for owner occupier, investor housing and personal fixed term loans exclude refinancing.
NP: Not published due to reporting issues. See data quality notes below.

Important data quality note

Seasonal adjustment methods

Recent review of seasonal adjustment factors

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 the disruption to the lending market during the COVID-19 period and the continuing use of a forward factors approach to seasonal adjustment, the ABS recently undertook an extensive annual review of its seasonally adjusted Lending Indicators series. This review followed similar reviews that are progressively being undertaken across the ABS economic statistics program. The results of the Lending Indicators review were implemented in the April 2021 release.

Static forward factors for the next 12 months were calculated through the review process and were used in the April 2021 release.

Further information can be found here:

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

All seasonally adjusted Lending Indicators series will continue to use the forward factors method for the foreseeable future and are expected to return to using concurrent adjustment when the risk of disruption from COVID-19 becomes sufficiently low. 

Business finance - purchase of property series

The Business finance series for the purchase of property for total and large-sized businesses have not been published this month. Reporting errors were identified in these series. The ABS is working with APRA and data providers to resolve the reporting errors as quickly as possible.

APRA reporting threshold changes

A reporting threshold determines the inclusion of lending institutions in the data APRA collects on behalf of the ABS and RBA. The threshold for Housing finance reporting has recently been reduced, resulting in a number of new entities reporting data for the first time. This data has been excluded from Lending Indicators for the time being. It will be incorporated following analysis and quality assurance. This may result in some revisions to Housing finance series. Users will be advised when the changes are implemented.

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.

     

Housing finance

In October 2021 in seasonally adjusted terms, the value of new loan commitments:

  • for total housing fell 2.5% but remained 32.2% higher compared to a year ago
  • for owner-occupier housing fell 4.1% but remained 15.1% higher compared to a year ago and 42.5% higher than pre-COVID levels in February 2020
  • for investor housing rose 1.1%, continuing an unbroken period of growth since October 2020 and rising 89.6% over the past year

  

In October 2021 in seasonally adjusted terms, the value of external refinancing:

  • for total housing fell 0.4% but was 33.6% higher compared to a year ago
  • for owner-occupier housing rose 0.8%
  • for investor housing fell 2.6%

Personal finance

In October 2021 in seasonally adjusted terms, the value of new loan commitments:

  • for fixed term personal finance rose 4.7%
  • for personal investment rose 11.6% 
  • for road vehicles rose 0.3%

  

Business finance

In October 2021 in seasonally adjusted terms, the value of new loan commitments:

  • for construction finance rose 3.6%, driven by a rise of 54.4% in finance for the construction of dwellings

The purchase of property series has not been published this month, as per the note above.

Housing finance (detailed)

New loan commitments by purpose (seasonally adjusted)

 Oct-2021Month percent changeYear percent change
Value($b)(%)(%)
 Owner occupier   
  Total housing (a)19.84-4.115.1
   Construction of dwellings2.16-6.9-24.1
   Purchase of newly erected dwellings1.21-7.50.8
   Purchase of existing dwellings15.13-3.730.5
  First home buyers5.19-4.8-4.4
 Investor   
  Total housing (a)9.731.189.6
    
Number(No.)(%)(%)
 Owner occupier   
  Total housing (a) (b)---
   Construction of dwellings4 456-4.8-33.2
   Purchase of newly erected dwellings2 197-5.2-7.1
   Purchase of existing dwellings26 297-3.810.9
  First home buyers11 402-3.8-16.0
 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 October 2021 in seasonally adjusted terms, the value of new loan commitments:

  • to owner-occupiers fell 4.1%, the fifth consecutive monthly fall
  • to investors rose 1.1%, the twelfth consecutive monthly rise

  

In October 2021 in seasonally adjusted terms for owner-occupier housing, the value of new loan commitments:

  • for the purchase of existing dwellings fell 3.7%, contributing 67.8% to the fall in total owner-occupier commitments
  • for the construction of new dwellings fell 6.9%, the eighth consecutive month of falls. The level of commitments has fallen by 49.1% from the all-time high seen in February 2021.
  • for the purchase of new dwellings fell 7.5%

(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 October 2021 in seasonally adjusted terms for owner-occupier housing, the value of new loan commitments:

  • in New South Wales fell 8.4%, driving the overall fall in owner-occupier housing
  • in Western Australia fell 7.4%, in Queensland fell 3.6%, in the Australian Capital Territory fell 19.0% and in South Australia fell 4.8%
  • in Victoria rose 2.6%, in Tasmania rose 3.3% and in the Northern Territory rose 0.1%

  

In October 2021 in seasonally adjusted terms for investor housing, the value of new loan commitments:

  • in Queensland rose 8.9%, continuing an unbroken period of growth since May 2020 and reaching a record high of $2.1b
  • in South Australia rose 15.0%, in New South Wales rose 1.3%, in Western Australia rose 4.4%, in the Northern Territory rose 78.7% (a smaller, more volatile series) and in Tasmania rose 3.3%
  • in Victoria fell 3.8% and the Australian Capital Territory fell 12.4%

  

In October 2021 in original terms:

  • the value of new variable rate loan commitments funded in the month fell 0.7%
  • the value of new variable rate loan commitments to first home buyers funded in the month fell 6.3%
  • the value of new fixed rate loan commitments funded in the month fell 7.6%
  • the value of new fixed rate loan commitments to first home buyers funded in the month fell 5.9%

*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 October 2021 in original terms, average loan sizes for owner-occupier dwellings (including construction, purchase of new dwellings and existing dwellings):

  • fell slightly at the national level by 0.6% following a record high in September 2021
  • fell in New South Wales by 1.5% and Victoria by 1.6%

*Where gaps in the series appear, those data points are not available for publication

First home buyers

In October 2021 in seasonally adjusted terms for owner-occupier first home buyers, the number of new loan commitments:

  • fell 3.8%, the ninth consecutive month of falls, and was 16.0% lower compared to a year ago

  • had the largest fall in Western Australia (down 13.8%), followed by Queensland (down 6.3%), New South Wales (down 4.3%), Tasmania (down 13.2%), the Australian Capital Territory (down 8.2%) and South Australia (down 1.0%)

  • in Victoria rose 1.9% and in the Northern Territory by 6.0%

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
Owner occupier dwellings
First home buyer ratio
Owner occupier housing
Total Australia11 51035.0%30.0%
 New South Wales2 82132.6%27.9%
 Victoria3 28537.6%31.8%
 Queensland2 59234.5%29.8%
 South Australia67428.5%23.9%
 Western Australia1 63039.7%35.4%
 Tasmania19833.8%26.5%
 Northern Territory78NP29.4%
 Australian Capital Territory232NP29.0%

NP: Not published due to the construction of dwellings denominator not being available for publication. 

  

Data downloads

We will be progressively transitioning to releasing Excel files in .XLSX format from 3rd December 2021

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.