Mortgage lending on all properties thaws out

The latest Reserve Bank data shows mortgage commitments rose 6.8% from $5.4 billion in August last year to $5.8 billion last month. This was up 15.7% from $5 billion in July or 8.2% when seasonally adjusted.

Mortgage values increased across all loan purpose types. The average value of new mortgages for property purchases at $551,100, up 0.9% from July and changes in loan provider at $590,100, but down 1.7% from July remains significantly higher than the overall average.

The value of loans for top-ups rose to $626 million last month, up 8.2% from July. Similarly, the value of loans for property purchases rose 16.1% to $3.7 billion and the value of loans for changes in loan providers rose 18.7% to $1.2 billion in August.

Total new mortgages for property purchases increased 0.2% from July to 64.6% in August. This share has been increasing since it reached 55.9% in March. New lending for changes in loan provider also increased 0.5% from July to 21.4%.

Lending to first home buyers rose to $1.4 billion, up 10.5% from July and 21.7% from August last year. First home buyers' share of the market dipped slightly to 23.7%, down from a record high of 24.8% in July. However, this is still 2.9% higher than in August last year. The average value of a mortgage taken out by first home buyers is down to $551,400, which is 2% less than in July 2023 and 3% lower than in August last year.

Owner occupiers’ borrowing rose to $3.3 billion, up 17.5% from July and an increase of 0.6% from August last year. Their share of new mortgages rose to 57.8%, up 0.9pp from July 2023 but down 3.6% from August last year.

On the other hand, the share of new mortgages to investors remained steady at 17.1%, the same as in July, but 0.3% higher than in August last year. Investors took out new mortgages totalling $986 million, up 15.6% from July and 9% from August last year.

A total of 15,952 new mortgages were lent by registered banks, up 15.6% from 13,795 in July. In comparison to August last year, the number of new mortgages has risen by 5.6% from 15,109. 

The average value of these new mortgages rose to $362,500, up slightly from $362,200 in July and up 1.2% from $358,300 in August last year.