The average new owner-occupier mortgage in Australia has reached a record high of $636,597, marking an increase of $154 per day over the past year.
The surge comes as property prices continue to climb in key states, despite the cash rate reaching its highest level since November 2011.
According to the latest Australian Bureau of Statistics (ABS) lending indicators, every state in the country experienced a rise in average new owner-occupier loan sizes this month.
New South Wales remains the state with the largest average new mortgage at $780,028, although this figure is still below the peak of $803,235 recorded in January 2022.
Queensland, South Australia, and Western Australia all saw record highs in their average new loan sizes for owner-occupiers.
Western Australia, in particular, witnessed an astonishing increase in the average new loan size of $93,967 in the past 12 months, translating to a daily rise of $257.
RateCity.com.au Research Director, Sally Tindall, said property prices had continued to soar, pushing mortgages higher.
“Across the country, the average new owner-occupier mortgage has risen by $154 a day over the last 12 months,” she said.
“On a 30-year mortgage, you can basically double that figure when adding in interest costs.
“In Western Australia, the average new mortgage for an owner-occupier is now almost $100,000 more than it was just 12 months ago – rising by a gobsmacking $257 a day.”
New lending on the rise
The value of new home loans saw an uptick in June, rebounding from a surprising drop in May.
Overall, new home lending has risen by 19.1 per cent compared to the same time last year, with investors leading the charge, boasting a 30.2 per cent increase in new home loans compared to June 2023.
The ABS figures for June 2024 reveal that the total value of new home loans approved was $29.19 billion, a monthly increase of $370 million or 1.3 per cent, and a year-on-year increase of $4.67 billion or 19.1 per cent. Owner-occupier loans amounted to $18.17 billion, while investor loans totalled $11.02 billion.
First home buyers struggling
The number of owner-occupier first home buyer mortgages recorded in June reached 9947 in seasonally adjusted terms.
While this represents a modest increase of 324 from the same period last year, it remains nearly half of the recent peak of 17,162 in January 2021.
“It’s incredible to think this has unfolded under the weight of a rising cash rate,” Ms Tindall said.
“While there is seemingly no shortage of buyers prepared to up their bids at heated auctions in key capital cities, many would-be first home buyers have their hands tied by the double whammy of rising rates and property prices.
“The latest ABS figures confirm the number of owner-occupier first home buyer mortgages is stuck in neutral, clocking in at just 9,947 in the month of June.
“This figure has managed to lift above the 10,000 mark just once since the start of the rate hikes – a far cry from the most recent peak in first home buyer numbers recorded back in January 2021 when over 17,000 first home buyer mortgages were written for owner-occupiers.”
Refinancing decline
Refinancing activity continued to slide in June, with a total of $15.79 billion worth of mortgages refinanced, representing a decline of $301 million from the previous month.
Fixed rate loans increasing
The proportion of new and refinanced loans opting for a fixed rate rose to 2.6 per cent in June, marking the highest level since September 2023.
Although this is a fraction of the peak in July 2021, when 46 per cent of loans were fixed rate, the trend indicates a shift in borrower preferences amid rising interest rates.
