Buyers defying interest rates as home loan lending value reaches highest level since 2022

Data from the Australian Bureau of Statistics last Friday showed 50,831 new loans were taken out across the country in August with a total value of $30.4 billion.

The figure is a 23% increase compared with this time last year and the highest since the Reserve Bank of Australia began rate hikes two years ago.

Canstar data insights director Sally Tindall said Australians are continuing to spend on property “despite the higher cost of borrowing, in pursuit of capital growth, buoyed by a tight rental market”.

August saw a monthly uptick for both investment and owner-occupied loans, while first-home buyers recorded a slight 0.4% drop on July figures, though within an annual increase of 9.2%.

Quality or quantity?

While the ABS data paints a rosy picture for value, the average national owner-occupier loan size has fallen slightly from record highs over winter.

Tasmania and Queensland are the only states in which average owner-occupier loan size did not drop in August, with Queensland posting a new record high average of $603,988, just shy of the $636,208 national average.

Deslie Taylor says interest in Queensland is continuing to increase among first-home buyers and those already on the property ladder. Picture: supplied

Gold Coast-based Mortgage Choice broker Deslie Taylor said the sunshine state continues to benefit from high demand thanks to both migration and price point.

“Queensland is still so buoyant and it's going to continue to be because there's more and more people just wanting to move up here and just not enough stock,” she said. “The minute you do get something on the market, it's gone in a heartbeat and because the demand is still there, sellers are getting what they're asking for properties, if not more.”

Ms Taylor said Queensland is also continuing to attract an influx of first-home buyers.

“There are still quite a lot of locations, especially in south east Queensland, at a price point where first-time buyers can get into the market, look at paying no stamp duty, and take advantage of the various government incentives,” she said. “Because of that, obviously demand is extremely high – buyers can get in the market with around a $42,000 deposit that will buy them a $700,000 property.”

Brokers in Queensland are also seeing plenty of property seekers already on the ladder looking to enter the local market.

“There are the people doing a sea change and buying something that's a little bit more expensive,” Ms Taylor said. “They can get more bang for their buck than what they're getting in the southern states.”

This three-bedroom house in Acton in Burnie is on the market for $340,000. Picture: realestate.com.au

In Tasmania, Launceston-based Mortgage Choice broker Peter Reynolds said the state has been benefitting particularly from recent stamp duty changes, as well as more broadly in the post-pandemic recovery period.

“We’ve noticed a lot of first-home buyer owner-occupier interest,” he said. “A big part of that would be the recent waiving of stamp duty for established houses, right up to $750,000, which is quite a good range for first-home buyers, particularly in the north of the state.”

Mr Reynolds said a cut in interest rates from the central bank would likely also see an increase in home loan applications in Tasmania.

“There is still relatively affordable housing in the state. After a crazy period of time for everyone during Covid-19, there is a feeling of the market being fairly stable here.

“Whenever we start getting the first interest rate cuts, I do think that will spark even more interest.”