Aussies\u2019 overall debt levels have hit a record high. Picture: NewsWire \/ Damian Shaw <\/p>\n
Australian first-home buyers are becoming more indebted than ever before, as rising house prices and interest rate relief spurs on buying activity.<\/p>\n
The average size of Australian loans is up $18,000 over the last three months, on the back of interest rate cuts in February and May, Australian Bureau of Statistics figures for the June quarter show.<\/p>\n
The new average loan size is $678,011.<\/p>\n
NSW has the largest average new loan size for owner-occupiers at $816,000, a new record for the state, after a rise of $21,000 over the three months until June.<\/p>\n
Aussies\u2019 overall debt levels have hit a record high. Picture: NewsWire \/ Damian Shaw <\/p>\n
Western Australia recorded the largest jump, up $26,000 or 4 per cent to $620,000.<\/p>\n
Victoria, Queensland and South Australia also recorded new highs, while the size of loan commitments fell slightly for Tasmania, the Northern Territory and the ACT.<\/p>\n
According to the ABS data, there were 80,929 new owner-occupier loans approved in the June quarter, 758 more than last quarter.<\/p>\n
ABS head of finance statistics Mish Tan said the rise in the June quarter came off a subdued March quarter, although she conceded that lending activity was still relatively high.<\/p>\n
\u201cWhile the number of new owner-occupier loans in the June quarter was slightly lower than this time last year, the value of loans rose by 7.4 per cent,\u201d Ms Tan said.<\/p>\n
\u201cThe average loan size has grown by 7.5 per cent since the June quarter 2024. This was consistent with higher property prices, noting growth has been stronger in Queensland, South Australia and Western Australia.\u201d<\/p>\n
The biggest jump in the market was led by new investment loans approvals, which were up 3.5 per cent to 49,065 in the quarter,<\/p>\n
The total value of new investment loans was $32.9bn, a rise of 1.4 per cent ($443m), with the average loan size up $1103 to $674,259.<\/p>\n
\u201cThe 3.5 per cent quarterly growth in the number of investment loans follows two consecutive quarterly falls,\u201d Ms Tan said.<\/p>\n
\u201cWhile annual growth slowed to 0.8 per cent from 27.0 per cent in the June quarter 2024, the number of new loans remained historically high.\u201d<\/p>\n
Canstar data insights director Sally Tindall expects the size of loans to continue to grow on the back of Tuesday\u2019s rate cut.<\/p>\n
Tuesday\u2019s rate cut could lift borrowing capacity further. Picture: NewsWire \/ Nicholas Eagar <\/p>\n
Tuesday\u2019s interest rate decision by the Reserve Bank board was unanimous and in line with previous comments where the central bank said future rate cuts were just about timing.<\/p>\n
The cut is the third in the cycle, after rate cuts in February and May, and follows the bank\u2019s shock decision to keep the cash rate on hold in July.<\/p>\n
\u201cWhen the cost of borrowing falls, some buyers use it to bid higher at auction, particularly in sought-after property hotspots,\u201d Ms Tindall said.<\/p>\n
\u201cCanstar research shows one 0.25 percentage point cut is likely to boost the average person\u2019s maximum borrowing capacity by $12,000 \u2013 not a windfall in isolation, but over the last three cuts, this could translate into an increase of $35,000.\u201d<\/p>\n
Ms Tindall said the third rate cut was likely to encourage more buyers into the market.<\/p>\n
\u201cAny boost in borrowing capacity should be taken with a healthy dose of caution. Just because the bank says you can borrow more money doesn\u2019t automatically make it a good idea,\u201d she said.<\/p>\n","protected":false},"excerpt":{"rendered":"Aussies\u2019 overall debt levels have hit a record high. Picture: NewsWire \/ Damian Shaw Australian first-home buyers are…\n","protected":false},"author":2,"featured_media":65278,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,169,99,164,9565,52032,52033],"class_list":["post-65277","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-au","tag-australia","tag-australian-bureau-of-statistics","tag-business","tag-economy","tag-interest-rate","tag-investment-loans","tag-loan-size"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/65277","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=65277"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/65277\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/65278"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=65277"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=65277"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=65277"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}