Record-breaking quarter for mortgages, but majors slip
Australia’s largest mortgage broker network, AFG reported an 8 per cent lift in mortgage growth over the last quarter, underpinned by first home buyers but market share for the major banks fell 67 per cent.
According to the AFT Index, more than 35,400 residential loans were lodged, with volume surpassing $18 billion for the quarter, eclipsing last quarter’s record-breaking levels
According to AFG, the surge was largely driven by an uptick in First Home Buyers as they make the most of federal and state government incentives to support the country’s construction market.
A total of 23 per cent of all lending applications processed by AFG brokers during the quarter were for those purchasing their first home.
“The major lenders’ market share dropped from 66.8 per cent at the end of the 2020 financial year, the highest level since 2017, down to 58.9 per cent at the close of the first quarter.
According to AFG CEO David Bailey, this trend was most evident when looking at the majors’ share of refinances, which tumbled from a high of 71.1 per cent at the end of the 2020 financial year to 58.1 per cent at the close of the first quarter of 2021.
ANZ was the standout, recording a significant drop in market share, sliding from 25.53 per cent back to 9.67 per cent.
Westpac seemed the beneficiary, rising from 10.37 per cent to 16.27 per cent of the majors’ market share.
The non-majors experienced growth across all buyer types, with the biggest rises being recorded by refinancers and upgraders.
The non-majors’ share of refinances jumped from 28.9 per cent to 41.9 per cent in FY21Q1 and market share for those upgrading increased from 34.4 per cent to 41.2 per cent.
Queensland and New South Wales lead the country for the non-majors, with market share increases in both states increasing by 10 per cent and 8 per cent respectively.
Among the non-majors, Macquarie recorded the largest lift in market share, rising from 6.74% to 10.25% for the quarter.
“The national average loan size is decidedly lower, dropping from $542,555 at the close of the last quarter to $514,532.
This drop is largely driven by the profile of borrowers, in this case the presence of more First Home Buyers in the mix.
This corresponds with a small uptick in loan-to-value ratio, again a reflection of the volume of First Home Buyers in the data.