Latest Reserve Bank data show investors borrowed $1.059 billion in February which was 18.6% of the $5,706 billion total lent to all borrowers and $1 billion more than January - the largest increase since February 2018.
Investor borrowing was up from 17.4% in January and 16.6% in December. This continues the trend observed in January, which was the first increase since September 2021. However, it was an annual drop of 42.9% after peaking in the middle of last year.
February’s total lending levels exceeded other February lending months between 2014-2020, but it down $1.9 billion (24.9%) from February last year.
While the value is comparable to 2020, the composition is quite different – the number of new commitments fell 31% compared with two years ago, while the average loan size increased by 48.2%.
In other words, the figures show there are fewer people borrowing but they are taking out bigger mortgages than two years ago.
The $5.7 billion borrowed in February was spread across just 14,867 mortgages and the average sized mortgage has risen to $383,300 compared to $258,900 in the same month two years ago.
Across the board, first home buyers February borrowing was $1 billion, up $135 million from the previous month, and a drop of 19.3% from last year. New mortgage commitments to other owner occupiers were up from $3 billion in January to $3.6 billion, but declining 19.5% over the year.
First home buyers made up 16.7% of total borrowing in February, down from 17.5% in January, the second consecutive drop since it peaked in December last year, while other owner occupiers declined slightly from 64% last month to 63.6%.