Investor surge pushes Australian housing loans to two-year high

Australia’s housing market continued its upward trend in August 2024, reaching the highest level of new lending since May 2022. According to the latest data from the Australian Bureau of Statistics (ABS), the total value of new housing loans increased by 1.0% to $30.4 billion, with investor activity leading the charge.

Canstar’s analysis of the ABS data showed that investor loans saw a significant boost, rising 1.4% in August to $11.71 billion – a 34.2% increase from the same period last year. This surge in investor lending marked the second-highest monthly value on record.

Loans to owner-occupiers also grew, increasing by 0.7% to $18.7 billion, reflecting a 16.5% rise year-on-year. However, first-home buyers faced a slight dip, with loans for this group dropping by 1.5% from July to August.

Despite the monthly decline, first-home buyer activity was still 9.2% higher than in August 2023. Tindall pointed out that while first-home buyers remain active, they face stiff competition from investors who can use rental income to offset the burden of higher mortgage payments.

Breaking down the data by state, Queensland emerged as a key driver of the national rise. Housing loan commitments in the state soared by 40% over the past year, adding $2 billion in value, more than any other state. In contrast, the average national loan size for owner-occupiers dropped by 1% in August, falling to $636,208. Although most states saw decreases, Queensland and Tasmania bucked the trend, with Queensland posting a record high loan size of $603,988.

Learn more about: Australia’s housing market