subscribe to our newsletter

Home buying intentions jump sharply: CBA

The major bank’s Household Spending Intentions series has revealed that home buying spending intentions spiked in April 2021 compared with 2020 and 2019.

After reaching a new series high in March, the Commonwealth Bank of Australia’s (CBA) latest HSI series report showed that home buying intentions surged in April 201 relative to both April 2020 and April 2019 to over 80 per cent.

The improvement was driven by both higher home loan applications and Google searches in April 2021 as the national real estate market attracted prospective buyers, the major bank said.

CBA also said that it expects the home buying market to be a key source of support for the Australian economy in 2021, driven largely by the very low level of interest rates.

It expects residential house prices to rise by 14 per cent to the end of 2022, CBA said.


The Household Spending Intentions series combines CBA’s spending data with Google Trends’ publicly available search activity and connects actual spending data to intentional data to provide an indication of prospective spending trends across seven key sectors.

The series showed improvement across all seven categories amid signs that the economy has progressed in its recovery in April 2021, according to CBA chief economist Stephen Halmarick.

Car buying spending intentions continued to improve in April 2021, compared with April 2020 and 2019, driven by both actual spend and car loan spend, the bank said.

CBA also said that the changing use of public transport, supply shortages, and changing patterns of work have all been boosting motor vehicle spending intentions. It added that the ongoing improvement in the housing market is expected to support the outlook for motor vehicle spending as increased household wealth could translate into increased demand for new and used cars.

Spending intentions also increased across the retail, entertainment, education and travel sectors compared with April 2020, the data showed.


However, while retail spending was stronger this April compared with April 2020 and April 2019, travel spending intentions were lower than April 2019, reflecting the lasting impact of COVID-19 on this sector of the economy, CBA said.

Commenting on the latest spending intention series, Mr Halmarick said that the improvement across the sectors was not a surprise as “we know that April 2020 was the low point for spending as the first wave of COVID-19 restrictions hit Australians”.

“A year later, the economy has recovered strongly from COVID-19 impacts, with employment above pre-pandemic levels and household spending intentions on the rise as consumers once again feel confident about their economic prospects,” he said.

Mr Halmarick noted that the economic recovery was reflected in the federal government’s 2021-22 budget, which said that the underlying cash deficit in 2021-22 is forecast to be $106.6 billion (5.0 per cent of GDP).

This has been projected to improve over the forward estimates to a $57.0 billion deficit in 2024-25 (2.4 per cent of GDP) and to a deficit of 1.3 per cent of GDP by the end of the medium term, budget papers have shown.

Mr Halmarick also noted that the budget included targeted support programs that he said “aim to put more people into jobs and ensure the economic recovery is widespread”.

Home ownership measures that were announced ahead of the full budget release included a new Family Home Guarantee that aims to give 10,000 single parents with dependants the opportunity to build a new home or purchase an existing home with a deposit of as little as 2 per cent without having to pay lender’s mortgage insurance, and the extension of the First Home Loan Deposit Scheme (New Homes) for a second year with an additional 10,000 places being made available in 2021-22.

[Related: Home buying intentions spike in February]

Home buying intentions jump sharply: CBA
Home buying intentions jump sharply: CBA

Are you a new-to-industry broker in the process of growing your business? Then there’s some great news: The Adviser’s New Broker Academy is back in 2021 and will provide you with essential insights into cutting-edge tools, strategies and processes to fast-track to success. Don’t miss your chance to attend. To secure your FREE place, visit newbroker.com.au now!

Malavika Santhebennur

Malavika Santhebennur is the features editor on the mortgages titles at Momentum Media.

Before joining the team in 2019, Malavika held roles with Money Management and Benchmark Media. She has been writing about financial services for the past six years.

Latest News

Reverse mortgage lenders have accessed a small fraction of the potential retiree housing market in Australia, according to Deloitte. ...

Pepper Money has priced its second I-Prime deal for the year, upsizing the figure to $850 million. ...

The LMI provider has announced a new CFO following the resignation of its current CFO, effective 24 September. ...

Join Australia's most informed brokers

Do you know which lenders are providing brokers and their customers with the best service?

Use this monthly data to make informed decisions about which lenders to use. Simply contribute to the survey and we'll send you the results directly to your inbox - completely free!

How long do you think it should take to discharge a mortgage?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.