- 90% of property transactions are now settled online
- DigiDocs platform has seen a 2,000% increase in use since July 2020
- Investors are making a comeback, CBA data shows
More and more customers are seeking out home loan information through online channels while property investors are returning, according to new data from the Commonwealth Bank of Australia (CBA).
Due to restrictions surrounding movement and face-to-face meetings, the home buying process has become increasingly digitalised.
90% of property transactions conducted by the bank are settled online. The usage of DigiDocs – effectively a new process that replaces paper contracts – has witnessed a 2,000% increase since July 2020.
Using CBA’s Netbank platform, around 370,000 customers are checking their home loan balance or interacting with the content and tools in the ‘Manage my loan’ functionality. These online actions occur an average of 26 times a month, an increase of 13% year-on-year.
The bank has also seen around 5,000 customers use its digital splitting tool since it was launched in April 2021.
The investor returns
Along with the surge in using online functions and tools, the CBA is predicting investors to return during this spring buying season thanks to ideal conditions.
Mortgage approvals for investors climbed to 29.4% in July, up from 23% in October 2020.
Meanwhile, investor system growth has increased by 2.9% over the last 12 months from -0.6% in July 2020 to 2.3% in July 2021.
“The current low rate environment is attractive to investors seeking a higher yield on their investments,” explained Dr Michael Baumann, Executive General Manager of Home Buying at CBA.
“The huge injection of government stimulus into the economy over the past 12-18 months will also see some investors who fear inflation invest in property which will further increase the investor mix of new approvals.”
Dr Michael Baumann, Executive General Manager of Home Buying CBA
Dr Baumann noted that while first home buyers started the last financial year strong, this cohort represented 18% of mortgage approvals in December 2020. By June this had declined to 12%.
Given prices are increasing he added that many first home buyers will likely continue to be placed out from the market.
“As we enter the spring buying season, there are affordability challenges for first homebuyers, however, availability of spots via government homebuyer schemes will alleviate some of this stress.”