NATIONAL

FIRST HOME BUYERS RETURN AS LENDERS COMPETE ON

RATES
2 November 2011
First Home Buyers are returning to the market in greater numbers than at any time since September
2009, according to AFG, Australias largest mortgage broker. The AFG Mortgage Index shows that
First Home Buyers comprised 16.4% of all loans processed a 40% increase for this buyer category
compared to October 2010 when they comprised 11.8% of the mortgage market.
First Home Buyers were particularly active in NSW, where 21.1% of home loans were arranged for
them in October, as well as QLD (17.9%) and WA (17.3%).
More mortgage buyers opted for fixed rate loans in October than in any month since March 2008.
Fixed rate loans comprised 20.4% of all home loans processed in October dramatic growth
considering they comprised only 7.9% of home loans as recently as July 2011.
Mark Hewitt, General Manager of Sales and Operations at AFG says: Buyers are reaping the benefits
of one of the most competitive mortgage markets weve seen in years. Discounted fixed rate loans
appealed to all buyer types, but especially first home buyers and those looking to refinance. We have
been slightly surprised with the popularity of fixed rates given it has been generally predicted variable
rates would decrease and we would now expect the proportion of fixed rate loans to fall, following
the cut in variable rates announced yesterday. Non major lenders are doing increasingly well in this
environment and hopefully yesterdays news will further support a market recovery which is still in its
very early stages.
Non majors have seized more market share than at any time over the past twelve months now
comprising 21.1% of all home loans. Their products are of particular appeal to first home buyers,
where almost 30% of the market is held by non majors, as well as buyers looking to refinance, where
non majors account for a 21.2% market share.
Investment accounted for 35.6% of all new mortgages, with investors especially active in NSW
(39.2%) and Vic (38.9%) with lower levels of activity in QLD (32.9%) WA (32.2%) and SA (29.8%).
AFG has 10% of the national mortgage market (Source: ABS data and AFG figures). The companys
data is usually indicative of the data published by the ABS six weeks later. Figures for each state are
available at: www.afgonline.com.au: Corporate - News.

ENDS
CONTACT DETAILS
Mark Hewitt, AFG General Manager Sales & Operations

Mob 0414 801 251 | Tel (08) 9420 7888

David Michie, Mosaic Reputation Management

Tel

(08) 9381 4494 | Mob 0411 453 404

www.afgonline.com.au

AFG MORTGAGES SOLD

TABLE 1: ALL AUSTRALIA
MONTH

TOTAL
NUMBER

TOTAL
AMOUNT

AVERAGE SIZE

PROPERTY
INVESTORS

FIRST TIME
BUYERS

%
REFINANCE

Aug 10
Sep 10
Oct 10
Nov 10
Dec 10
Jan 11
Feb 11
Mar 11
Apr 11
May 11
June 11
July 11
Aug 11
Sep 11
Oct 11

6,269
6,157
5,891
6,619
5,472
3,583
5,365
6,436
5,489
6,483
6,205
5,937
7,198
6,687
6,349

$2,343 m
$2,335 m
$2,234 m
$2,511 m
$2,076 m
$1,310 m
$2,053 m
$2,513 m
$2,119 m
$2,517 m
$2,382 m
$2,293 m
$2,764 m
$2,633 m
$2,509 m

$373k
$379k
$380k
$379k
$379k
$365k
$382k
$390k
$386k
$388k
$384k
$386k
$384k
$393k
$395k

34.3%
34.5%
35.4%
35.1%
35.5%
34.7%
33.9%
34.7%
34.9%
36.5%
36.2%
35.6%
36.5%
37.7%
35.6%

11.7%
12.6%
11.8%
12.2%
11.4%
14.1%
14.6%
13.9%
13.9%
13.2%
12.9%
13.6%
13.8%
15.7%
16.4%

38.3%
36.8%
37.8%
38.5%
41.5%
36.1%
37.0%
36.9%
36.7%
36.8%
39.2%
39.1%
38.2%
37.9%
37.9%

MAJOR VS NON MAJOR LENDER MARKET SHARE

TABLE 2: BY BUYER T YPE
TOTAL MORTGAGES

REFINANCE

FIRST HOME BUYERS

INVESTORS

MONTH

MAJOR

NONMAJOR

MAJOR

NONMAJOR

MAJOR

NONMAJOR

MAJOR

NONMAJOR

2010 10
2010 11
2010 12
2011 01
2011 02
2011 03
2011 04
2011 05
2011 06
2011 07
2011 08
2011 09
2011 10

80.6%
80.6%
81.1%
80.7%
79.4%
81.7%
82.4%
80.4%
82.1%
81.7%
82.0%
80.1%
78.9%

19.4%
19.4%
18.9%
19.3%
20.6%
18.3%
17.6%
19.6%
17.9%
18.3%
18.0%
19.9%
21.1%

77.1%
77.3%
78.7%
77.5%
74.5%
79.0%
80.5%
78.7%
78.7%
79.8%
80.3%
78.6%
78.8%

22.9%
22.7%
21.3%
22.5%
25.6%
20.9%
19.5%
21.3%
21.3%
20.2%
19.7%
21.4%
21.2%

74.6%
77.6%
79.0%
77.1%
75.0%
79.7%
77.3%
77.1%
76.2%
77.6%
77.8%
70.7%
70.8%

25.4%
22.5%
20.9%
22.9%
24.9%
20.3%
22.8%
22.9%
23.8%
22.5%
22.2%
29.3%
29.2%

83.7%
82.9%
82.4%
82.2%
81.6%
82.2%
83.3%
83.0%
82.9%
83.0%
83.4%
82.8%
82.7%

16.3%
17.1%
17.6%
17.8%
18.4%
17.8%
16.7%
17.0%
17.0%
17.0%
16.6%
17.2%
17.3%

Majors
= Four major banks including the brands they own
Non-Majors = All other lenders

www.afgonline.com.au

AVERAGE MORTGAGE SIZE IN DOLL ARS

TABLE 3: STATE BY STATE
MONTH
2010 07
2010 08
2010 09
2010 10
2010 11
2010 12
2011 01
2011 02
2011 03
2011 04
2011 05
2011 06
2011 07
2011 08
2011 09
2011 10

AUSTRALIA
370,505
373,750
379,374
380,027
379,385
379,444
365,799
382,725
390,479
386,218
388,384
384,042
386,382
384,124
393,822
395,226

NSW
428,943
433,378
454,325
442,743
434,898
432,540
416,527
451,630
467,034
453,492
453,286
455,559
456,388
452,230
461,132
447,144

QLD
335,850
341,353
318,556
354,651
354,220
344,485
319,554
354,012
357,177
357,453
354,886
347,506
360,034
348,880
358,846
358,142

SA
288,165
305,536
300,754
315,306
305,978
324,070
301,933
321,672
309,931
315,692
302,057
294,092
318,695
323,487
325,771
329,566

VIC
356,642
360,431
354,673
359,271
359,343
370,978
349,155
346,465
360,051
363,724
379,993
362,063
388,360
382,884
383,114
396,238

WA
393,134
391,397
398,064
393,479
395,325
396,047
397,102
394,922
396,572
404,714
399,372
412,557
371,500
382,598
397,917
406,019

NT
358,630
332,643
318,556
307,661
338,145
339,641
329,902
360,971
376,348
326,205
383,786
347,725
355,855
321,164
338,159
369,765

WA
61.4%
61.6%
63.7%
64.1%
63.6%
66.8%
65.9%
65.0%
65.1%
63.8%
65.2%
66.5%
65.0%
66.4%
67.8%

NT
60.6%
59.7%
59.0%
64.2%
68.7%
66.2%
78.2%
63.1%
56.8%
66.1%
61.0%
66.0%
67.1%
62.3%
60.5%

LOAN VALUE RATIOS (loan stated as % of property value)

TABLE 4: STATE BY STATE
2010 08
2010 09
2010 10
2010 11
2010 12
2011 01
2011 02
2011 03
2011 04
2011 05
2011 06
2011 07
2011 08
2011 09
2011 10

AUSTRALIA
63.0%
63.0%
64.5%
64.2%
65.9%
65.4%
68.8%
65.8%
63.9%
65.5%
64.2%
66.3%
67.7%
66.0%
66.7%

NSW
67.0%
64.9%
67.5%
65.1%
66.2%
66.5%
69.2%
66.8%
65.4%
66.2%
64.4%
68.7%
70.1%
69.0%
70.0%

QLD
62.4%
63.3%
65.5%
64.2%
65.1%
62.8%
66.5%
65.2%
65.4%
66.0%
66.0%
66.3%
67.1%
68.9%
67.9%

SA
62.3%
63.5%
64.9%
62.1%
65.5%
62.2%
66.5%
67.2%
64.9%
64.8%
63.4%
65.0%
67.8%
64.1%
67.8%

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VIC
64.1%
64.9%
66.3%
65.5%
66.1%
67.7%
66.5%
67.5%
65.8%
66.0%
65.3%
65.5%
69.9%
65.2%
65.9%

LOAN T YPE
TABLE 5: ALL AUSTRALIA
MONTH
Sep 10
Oct 10
Nov 10
Dec 10
Jan 11
Feb 11
Mar 11
Apr 11
May 11
June 11
July 11
Aug 11
Sep 11
Oct 11

BASIC
16.7%
16.2%
15.0%
13.7%
14.6%
14.2%
11.8%
10.6%
11.7%
10.6%
13.2%
11.7%
9.9%
8.8%

EQUITY
9.0%
10.4%
9.5%
9.0%
7.7%
9.7%
9.3%
9.7%
8.9%
9.3%
8.6%
9.6%
7.7%
8.1%

FIXED
5.4%
6.3%
9.0%
12.6%
9.0%
6.6%
6.6%
6.4%
8.4%
8.2%
7.9%
9.4%
16.6%
20.4%

INTRO
7.5%
6.9%
7.4%
8.9%
11.9%
13.2%
15.6%
14.3%
12.5%
11.5%
8.5%
6.0%
4.7%
3.9%

STANDARD
61.4%
60.0%
59.1%
55.7%
56.7%
56.2%
56.6%
58.9%
58.5%
60.4%
61.8%
63.2%
60.9%
58.6%

DEFINITIONS
1. Standard Variable: includes the full range of features available.
2. Basic Variable: without some features, lower fees and rates.
3. Intro: also known as honeymoon where the borrower is offered a very cheap initial rate (fixed or variable)
before the loan reverts to a Standard Variable.
4. Fixed: interest rate is fixed for a nominated period before it reverts to a Standard Variable.
5. Equity: also known as line of credit allows the borrower to draw out money up to a specified limit. Generally
more expensive than Standard
NOTE TO EDITORS

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