New Home Loan First HomeBuyers
New home loans to first home buyers broke a new record in January. Image – Canva.
  • New loan commitments to owner-occupier first home buyers hit $28.8B in January
  • This represented a 44.3% increase on the same month a year earlier
  • First home buyers accounted for 36.5% of all owner-occupied loans

Australians took out a record $28.8 billion of home loans in January, according to the Australian Bureau of Statistics.

This was a staggering 44.3% higher than the year before.

First home buyer activity increased at an even faster rate – 70.8%.

* First home buyers signed up for 16,664 loans in January – the highest number since 2009 (see graph)

* First home buyers accounted for 36.5% of all owner-occupied loans (excluding refinancing)

New loan commitments to owner-occupier first home buyers (seasonally adjusted)

New Loan Commitments 2021
Source: ABS, Lending Indicators, 2003-2021

The last time there was a spike like this was back in the middle of the global financial crisis (GFC) of 2008/09, when the Kevin Rudd government handed out financial assistance and homebuilder-type packages.

Since then, there have been around 7,500 first home buyer loans taken out a month on average, rising slightly in 2018 to 8,500.

16,000 or more loans in January 2021 represents a huge increase, as first home buyers take advantage of various HomeBuilder grants. These were $25,000 last year (up to September 2020) and then reduced to $15,000, and look set to finish this month. On top of this, various other generous state-level grants of $10,000, low-interest loans and stamp duty exemptions have also been on offer.

One might say the government assistance worked. What will happen post-March 2021 will be interesting to see.

As home loan commitments nearly always feeds into higher property prices about six months down the track, this level of lending will only put upwards pressure on property prices towards the middle and back end of 2021.

You May Also Like

Westpac sees rates hitting 4.1 per cent and property prices falling further

Westpac said, “2023 will be another challenging year, particularly as the RBA continues to ratchet interest rates higher.”

Home loan hacks: four way to save money on your mortgage

With interest rates expected to keep rising, Compare Club has tips to ease the mortgage pain.

CoreLogic’s guide to navigating a looming ‘fixed-rate cliff’

Many borrowers will feel mortgage pain when they next refinance

How much does it cost to move house?

From cleaning fees to moving services, the costs of moving houses can add up fast

Top Articles

PropertyGuru Asia Property Awards (Australia) returns for its 7th edition, including several brand new award ...

This year's awards include several brand new categories, with entries closing 2 August 2024.

Rentvesting in Australia: A deep dive

Rentvesting offers an alternative path into the property market for priced-out first-time buyers.

Housing crisis survival guide: How to buy your first Australian property

Three property experts give the low down on how to nab a home in this tough housing market.