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Data & Insights

Mortgage Insights Report | New lending slows to pre-pandemic levels

By PEXA • Aug 2023

The number of Australians taking out new mortgages fell across the country in FY23, with new loan activity returning to pre-pandemic levels, compared with the previous two years. In contrast, refinancing activity continued to surge higher in FY23, in response to rising interest rates and attractive incentives offered by major banks enticing borrowers to switch lenders, according to new research released by PEXA today.

PEXA’s latest Mortgage Insights Report found that a total of 481,234 new loans were issued nationally by Australian lenders in FY23 to fund property purchases – which was down by 20.6% from FY22, with all states experiencing double digit drops in new loans. QLD topped the states with the highest number of new loans issued in FY23 (131,463), while the larger states of NSW and VIC saw the greatest declines, as new lending activity returned to similar levels to FY20 during the onset of the pandemic.

The report found median loan amounts for new loans trended downwards in FY23 in Sydney ($739,650 down from $784,000 in FY22) and Melbourne ($556,497 down from $582,000 in FY22), in line with declining median sale prices in those cities during FY23.

Conversely, the volume of refinancing activity rose by 13.8% to 450,177 nationally in FY23 and continued to rise significantly across all states. in FY23, Growth in refinancing was strongest in WA which was up 29.5% from FY22, followed by SA (+19.4%) and QLD (+17.4%).

PEXA’s Mortgage Insights Report analyses the latest mortgage trends across new loans and refinances in the mainland states of NSW, VIC, QLD, WA and SA in FY 23, compared to the past four years. This report also examined market share across the major and non-major banks and found the major banks held a leading market share for refinances across all states in FY23, which was highest in WA (68.7%).

PEXA’s Head of Research, Mike Gill, said “new lending activity declined across the board in FY23 which reflects the property market normalising to pre-pandemic levels, after an exceptional boom across all mainland states over the previous two years. By contrast, we’ve seen refinancing figures continue to trend upwards over the past three years with particularly strong increases since the RBA began to raise interest rates from May 2022”.

“The rise in refinancing activity in FY23 has also been boosted by the high proportion of recent borrowers who had taken out fixed-term loans over the preceding few years. These borrowers are now rolling off their low interest, fixed-term loans, leaving them open to a better deal. The lure of attractive incentives offered by many of the major banks over the year to entice borrowers to switch lenders, is clearly working.

“When we looked a little deeper into the data, the major lenders came out on top in FY23, gaining market share for loan refinances over non-major lenders, with an increase of 1.9% nationally. The same was true for new loans, with major banks growing their share the most in NSW (by 3.1%). In an environment of rising interest rates we have seen intense competition between lenders, with the major banks fighting hard to attract new customers – and they’ve been successful,” he said.  

Download Mortgage Insights Report

Diagram showing new loans in 2023

New Loan Highlights 

  • 131,463 new loans were issued in QLD in FY23, more than in any other state. Of these, 125,547 were for residential property.
  •  NSW and VIC saw median amounts for residential new loans fall in FY23. However median loan amounts rose in QLD, WA & SA to $458,096, $404,420 and $431,107 respectively. Residential loan amounts were highest in Sydney, particularly in the Northern Beaches, East Suburbs, North Sydney and Hornsby and Baulkham Hills and Hawkesbury.
  •   The Major banks increased their market share for residential new loans in FY23 in all states except SA. The Major banks grew their share of new loans the most in NSW (up 3.1% in FY23) followed by WA (up 2.7%).

Refinance Highlights 

  •   Over each of the past 4 years, VIC recorded the highest number of refinances nationally, with 150,592 in FY23. This was up +14.7% on FY22 and ahead of second place NSW on 134,411.
  • WA experienced the highest growth rate in refinances in FY23, up 29.5% to 45,965. SA (+19.4%) and QLD (+17.4%) also exhibited high year-on-year growth rates.
  • The Major banks held a leading market share for refinances across all states in FY23. Their market share was highest in WA (68.7%) and lowest in QLD (60.2%).


For more information please visit PEXA Insights 




For further commentary or information, please contact:

Danielle Tricarico – Head of Corporate Affairs, PEXA
M: 0403 688 980


About PEXA

PEXA is a world-leading digital exchange and data insights listed proptech business. Since 2014, PEXA has facilitated more than 15 million property settlements through the PEXA Exchange in Australia. PEXA has launched refinancing capability in the UK and operates an insights business that helps government and business unlock the future value of property.


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