Investor lending inching closer to record high

New investor loan commitments nearing record highs
Queensland investor loan commitments rose to a new record high
Owner-occupier loan commitments declined

New investor loan commitments are closing in on historic record highs according to data from October 2021 released by the Australian Bureau of Statistics (ABS) today.

The commitments rose 1.1% in October.

ABS head of Finance and Wealth, Katherine Keenan, explained that the recent data tops of a year of growth.

“The value of new loan commitments for investor housing has grown for 12 consecutive months, reaching $9.7 billion in October 2021.”

Katherine Keenan, ABS head of Finance and Wealth

“This was the highest level since the all-time high in April 2015,” Ms Keenan said.

ABS Lending Data

“While the value of investor loan commitments has grown 90% over the past year, the number of investor loans only accounted for 33% of all new loan commitments for housing in October,” said Ms Keenan.

State by state investor loan commitments

National records may remain intact but in Queensland investor loan commitments increased 8.9% rising to a new record high of $2.1 billion.

Most other states and territories also reported increased loan commitments.

Increases were recorded in South Australia (up 15.0%), Western Australia (up 4.4%), New South Wales (up 1.3%) and Tasmania (up 3.3%).

The Northern Territory shot up 78.7%, but this should be taken with a pinch of salt as the territory’s data tends to be smaller and more volatile.

Declines were also seen in Victoria (down 3.8%) and the Australian Capital Territory (down 12.4%).

Owner-occupier loan commitments

Across the total new loan commitments for housing, there was a 2.5% decline in October 2021.

This can be accounted for by owner-occupier loan commitments which saw a 4.1% decline.

“The value of owner-occupier loan commitments fell for the fifth consecutive month, but remained 15% higher compared to a year ago and 43% higher than pre-COVID levels in February 2020.”