Mortgage lending continues steady growth

New authorised deposit-taking institution (ADI) data from the Australian Prudential Regulation Authority’s (APRA) has shown that total residents loans and finance leases increased by 1.2 per cent ($37.4 billion) in June, led by lending to non-financial businesses.

This increase continued momentum from the previous month’s 0.8 per cent jump.

APRA reported the increase was “indicative of continued resilience of business conditions”.

Home lending “remained stable” in the month of June, with banks reporting an 0.8 per cent increase in owner-occupier lending to the value of $10.5 billion and investment lending went up by $4.8 billion (or 0.7 per cent).

For the year ended June 2022, owner-occupied lending increased by $111.5 billion (or 9.0 per cent) and investment by $37.7 billion (or 6.0 per cent).

But given the cost-of-living pressures and interest rate increases, APRA noted the annual growth rate for owner-occupied lending was slowing.

In addition, the growth in investment housing lending is likely supported by rising rental yields, low vacancy rates and the expected return of overseas migration.

The big four banks all reported month-on-month increases in home lending over the month of June.

Commonwealth Bank saw the largest rise month-on-month with the bank’s total home loan book coming in at $519.2, up from $516.5 billion last month.

This was largely driven by its owner-occupier loans that came in at $345.4 billion.

ANZ book was up to $262.1 billion in home lending. The group has $173.0 billion in its owner-occupier book, a slight uptick from the previous month’s $261.1 billion.

NAB’s total mortgage book tipped over $300 billion, compared to $289.2 billion last month, with owner-occupier accounting for more than half of $192.4 billion.

Westpac’s home loan book climbed to $432.4 billion, with $278.6 billion coming from owner-occupier loans. This was up on last month’s $429.7.

This supports the Reserve Bank of Australia’s financial aggregates data on home lending for June, which found owner-occupier lending had ticked up 0.6 per cent in June, compared to the month earlier, which marked an 8.6 per cent jump over the year.

Home lending for investments followed the same increase at 0.6 per cent.

[Related: Positive swings in home lending: APRA]