Home loan statistics in Australia at a glance
- Average new owner occupier home loan amount: $626,055 (in May 2024)
- Average initial monthly repayment: $3,863 (over 30 years)
- More than 25,000 Australian homeowners switched their home to another lender in March 2024
- Average home loan interest rate: 6.27% p.a. (owner occupier)
- 98.3% of new home loans are variable, only 1.7% are fixed
- 19.8% of new home loans are interest-only (the remainder being principal and interest)
- The total value of new home loans issued per month is $32.94b
- 59% of Australians apply for a home loan by themselves versus 41% with someone else
Average home loan in Australia (by loan amount)
The average new home loan in Australia is $626,055 for owner occupier homes, including loans for purchases of established properties, construction loans and refinancing of existing home loans. That's according to the latest data from May 2024 from the Australian Bureau of Statistics.
The average new home loan size is largest in New South Wales and lowest in the Northern Territory, mirroring the median values of properties across the country.
Looking at the breakdown of loan sizes in more detail we can see that first home buyers are currently taking out smaller loans than refinancers, both across owner occupier and investor loans.
- Average first home buyer loan: $533,621
- Average refinance home loan: $559,822
- Average new investment property loan: $588,454
- Average investment loan refinance: $623,555
Across the board, the average loan size in Australia has grown significantly over time.
This steady increase in loan size comes despite surging interest rates in the last couple of years. CoreLogic Australia’s Head of Research, Eliza Owen, explained to Money.com.au that this is down to stubbornly-high property prices.
“One of the extraordinary phenomena of the current rate-hiking cycle is that despite higher interest rates, we've also seen property values not only recover from a short, sharp decline where the market bottomed out in the beginning of 2023, but values have actually managed to climb back to new record highs.”
Eliza Owen, Head of Research at CoreLogic Australia
“Part of the reason that home values have continued to increase in a high interest rate environment is because of a surge and an acute level of net overseas migration, changes in households formation where there are fewer people living per dwelling, and also the constraints that exist in the construction sector. At the moment the market is for higher income households.”
Eliza Owen, Head of Research at CoreLogic Australia
Average home loan repayment
The average monthly home loan repayment in Australia is $3,863. But mirroring average loan sizes, the repayment amount varies significantly across states and territories. Unsurprisingly, borrowers in New South Wales pay most on average – $4,736. The average repayments in the Northern Territory is significantly lower at $2,699.
As the graph below shows, borrowers are spending considerably more on mortgage repayments now than they were only a few years ago.
| Location | Average home loan amount | Average monthly repayment |
|---|---|---|
Australia overall | $626,055 | $3,863 |
NSW | $767,584 | $4,736 |
VIC | $601,891 | $3,714 |
QLD | $586,627 | $3,620 |
SA | $541,775 | $3,343 |
WA | $538,860 | $3,325 |
TAS | $462,324 | $2,853 |
NT | $437,427 | $2,699 |
ACT | $614,242 | $3,790 |
Average home loan deposit in Australia
The average first home buyer home loan deposit is $159,000. This has increased by more than 50% since 2020, according to the National Housing Finance and Investment Corporation.
Naturally, the time it takes to save up a deposit has risen too. It now takes first home buyers in Australia around 10 years on average to save up a 20% home deposit, based on analysis by ANZ and CoreLogic. Again, the distribution across the country is very uneven – if the average person wanted to buy a house in Sydney, it would take them 15.7 years to save the deposit.
The average mortgage borrower in Australia
We analysed a sample of more than 1,800 borrowers who recently requested a home loan through Money. Based on this research, here’s a breakdown of who is applying for a home loan in Australia.
- 59% of mortgage borrowers apply for a home loan by themselves, while 41% borrow with someone else.
- The average annual income of an individual home loan borrower is $137,000. That's almost 40% higher than the average annual ordinary time earnings of a full-time worker in Australia).
- Joint borrowers have a combined annual income of $244,000 on average.
- Almost 77% of borrowers report they have an ‘excellent’ credit score.
- Investors, on average, report better credit scores than owner occupiers (80% of investors report an excellent score).
- The vast majority of home loan borrowers are employed full-time (87.6%).
- Self-employed borrowers request larger loan amounts on average: $616,000 versus $540,000 for full-time employees.
- Borrowers who have been in their job for more than two years request to borrow 22% more on average than those who have been in their job for less than six months.
- Refinancers on average request to borrower 52% of their home's value (loan to value ratio), while those buying a new home request 75% and inve
Where do Australians get their home loans?
Home lending in Australia is heavily concentrated around the 'big four' banks. In fact, the combined value of home loans with the major banks is around three times that of all other banks in Australia combined.
For borrowers who refinance their home loan, around 60% do so with a different lender. And more than 70% of all home loans are taken out with the help of a mortgage broker, according to the Mortgage & Finance Association of Australia.
Mortgage borrowing in Australia by loan type and location
Monthly home lending has fallen from the highs of late 2021 and early 2022. But compared to a year ago, current overall lending is up by around 18% overall, driven by both growing owner-occupier (+12%) and investor (+29.5%) lending.
“When you compare investor growth in new housing finance to owner occupiers, it's much stronger,” says Eliza Owen.
“Investors in this country have a capital growth strategy and I think they're anticipating growth off the back of a potential cash rate reduction.”
However, according to Dr Nalini Prasad, a Senior Lecturer at UNSW's Business School, new lending growth is likely to be sluggish in 2024.
“Households have spent the large savings buffers that they accumulated during the COVID-19 pandemic. These buffers initially insulated household spending from the increase in interest rates, but with these savings buffers gone, interest rate increases are going to have more bite.”
She said lending is likely to recover in the longer term, as high overseas migration into Australia continues to support the housing market.
Even for the remainder of 2024, some sectors will continue to perform strongly.
Dr Nalini Prasad, Senior Lecturer, UNSW Business School
“Sectors of the market which have a large fraction of cash buyers are likely to outperform the overall market in 2024. Cash buyers are typically wealthier, older individuals who are unaffected by changes in interest rates. These buyers are more likely to purchase properties in regional areas where they intend to retire.”
Dr Nalini Prasad, Senior Lecturer, UNSW Business School
The recent volatility in property lending levels has been felt most sharply in the larger states, particularly Victoria which as struggled in the latter parts of 2023 and early into 2024.
Fixed rate lending has fallen off a cliff and now makes up a tiny portion of the home loan market. Again, an expectation that interest rates are due to fall is the likely driver for more borrowers choosing a variable rate.
Interest only loans versus principal & interest
According to banking regulator, APRA, fewer than one in five new home loans (19.8%) in Australia have interest-only repayments. The remainder are loans with principal and interest repayments. That's based on loans issued by authorised deposit-taking institutions (ADIs) between 1 January and 31 March 2024.
