New home loan commitments have surged as the easing of coronavirus restrictions prompted a normalising in buying activity.
New home loan commitments have surged as the easing of coronavirus restrictions prompted a normalising in buying activity.

Home loan levels jump to biggest on record

Australia has experienced its largest rise in new home loan activity as easing restrictions and cheap rates prompt a surge in buying activity.

Latest figures from the Australian Bureau of Statistics show new loan commitments in July rose 8.9 per cent compared with the previous month.

It is the largest month-on-month rise ever recorded by the bureau and has been spurred on by significant rises in owner-occupier loan activity.

Owner-occupier loans rose 10.7 per cent over the month of July, while first-home buyer owner-occupier commitments jumped 14.4 per cent.

New investor loans rose 3.5 per cent compared to the previous month.

ABS head of finance and wealth Amanda Seneviratne said the rise followed an easing of coronavirus restrictions in most states and territories that allowed buying activity to rebound from the lows experienced at the beginning of the pandemic.

"July owner-occupier home-loan commitments rebounded with the largest month-on-month rise in the history of the series as social distancing restrictions eased in most states and territories," she said.

"New loan commitments for owner-occupier housing rose in all states and territories except the Australian Capital Territory."

The largest rise in new loan commitments were in NSW, Victoria and Queensland.

Ms Seneviratne said Victoria's rise in new commitments reflected the easing of restrictions in July before the state was thrown into stage 4 lockdowns.

Personal finance loans rose 6.9 per cent compared with June figures.

Originally published as Home loan jump biggest on record


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