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The Australian Finance Group’s (AFG) most recent AFG Index has revealed that brokers completed the financial year at a new high, with the company recording $23.3 billion in mortgage finance lodged for 4Q24.
According to the aggregator, this figure is representative of the largest lodgement volume achieved since the 2Q22, and the largest ever recorded for a Q4.
The 4Q24 figure sits just shy of the record of $24.6 billion reached in 2Q22 and has shown a quarterly increase of approximately $3 billion on the previous quarter.
AFG CEO David Bailey said on the results: “Broker activity over the quarter was high and lodgement numbers hit more than 36,395 in the final three months of the 2024 financial year.
“This lift was led by compelling contributions from Western Australia and New South Wales which saw a jump in volumes of 22.02 per cent and 18.7 per cent respectively.
“Other states also contributed strongly with increases in Queensland (up 12.2 per cent), South Australia (10.7 per cent), and Victoria (10.4 per cent).”
Additionally, the proportion of loans lodged to investors reached its highest level since the 3Q17 at 32 per cent.
Lending to investors has been outpacing owner-occupier lending for most of 2024, with the latest Lending Indicators data released by the Australian Bureau of Statistics (ABS), revealing $10.7 billion of new lending commitments to investors during May, with loans to investors trending upwards since the same time in 2023.
According to the ABS, investor loans across most states and territories have trended upwards since the same time in 2023, with large increases seen in Western Australia (73.9 per cent), Queensland (48.2 per cent), and NSW (24.8 per cent).
Bailey said that interest-only loans were also up from 19 per cent in the previous quarter to 21 per cent, which has reflected the “increase in investor activity for the quarter”.
“Over the past two years we have seen Investor loans steadily creep up to now sit at 32 per cent – up from 27 per cent two years ago but still below the longer-term average of around 35 per cent,” Bailey said.
“While total investor loan lodgements for the quarter increased by 16 per cent ($1 billion) on the same period of FY23, and 19 per cent on the prior quarter, Victoria’s share of investor loans has dipped below its long-term average in Q4 2024.
“It will be interesting to see if the Victorian State Government property tax changes continue to impact the attractiveness of property investment in the Education State.”
[RELATED: Mortgage demand dips in May]
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