Victorians’ mortgages rise to an average of $496,815, while fewer Aussie borrowers stick with the big banks

Richard Whitten 12 January 2018 NEWS

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AFG Mortgage Index figures for the last quarter of 2017 show non-major lenders now occupy 35.8% of the mortgage market.

Victorian mortgages are growing, with the average loan size in the state rising 3.2% to reach $496,815 in the last quarter of 2017. That's a $20,385 increase in the last 12 months, while NSW saw a $10,662 increase.

This data comes from the latest AFG Mortgage Index report, covering the last quarter of 2017. While AFG's data doesn't cover the whole of the home loan market, it provides a useful, data-rich snapshot of Australian mortgage holders.

So much media attention of late has focused on the Sydney property market's decline, but there's clearly a lot going on in Victoria. The state has the most generous first home buyer concessions and has seen a surge in first home buyers.

Smaller lenders continue to grow in popularity

An equally interesting finding from AFG's report is the continuing decline in the big banks' market share. The major banks took 64.2% of the market in the last quarter of 2017, with non-major lenders taking 35.8%.

"The majors are continuing to lose ground to the non-majors, as borrowers increasingly look at alternatives to the major bank owned brands," said AFG CEO David Bailey.

A lot has changed in the last five years. In 2013, the AFG Mortgage Index found non-major lenders occupying 22.9% of the market and the big banks taking 77.1%.

Smaller lenders are most popular in Queensland, where they occupy 41.39% of the state's market.

Mortgage breakdown by type

In terms of mortgage types, refinancers fell to 22% of all loans lodged in the quarter, while first home buyers held steady at 13%.

Upgraders rose to 44%, up from 41%. Investment loans continued their decline, representing 28% of loans. In 2015 mortgages for property investors made up 40% of the market.

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