NATIONAL

BORROWERS DEFY GLOBAL GLOOM

RATE CUT SEES MORTGAGE MARKET LEAP 18% IN NOVEMBER
Record 2 in 5 new mortgages for investors
2 December 2011
Mortgage borrowers defied the global gloom in November with the RBAs quarter of a percent rate
cut seeing the number of mortgages processed increase by 18.4% over October figures, according to
AFG, Australias largest mortgage broker.
AFG processed over $2.9 billion of mortgages in November, its highest such figure since March 2009.
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.
Growth was particularly strong in Victoria, where mortgages processed leaped 26.7% and
Queensland (20.8%). Elsewhere, growth was recorded in NSW (16.4%), WA (15.8%) and SA (8.7%).
Mark Hewitt, General Manager of Sales and Operations says: While November is seasonally a strong
month for mortgages, the rate cut has certainly stimulated demand. Were experiencing the paradox
that weaker global economic conditions and lower rates, is good news for Australian property buyers
- at least for now. Its significant that investors and first home buyers are leading the action. Many
had been fearful that we were locked into a scenario of constant rate hikes. The November rate cut
proved to be a real a turning point and the outlook is very different now.
Property investors accounted for almost 2 out of every 5 mortgages sold in November (38.4%) an all
time record for the AFG Mortgage Index, which goes back six years. Investors were especially active
in New South Wales (44.6%) and Victoria (39.8%), but also strong in Queensland (37.7%), Western
Australia (32.1%) and South Australia (30.0%).
Fixed rate loans came off their high of 20.4% of the product mix in October to 17.2% in November a
figure still well above the long term average.
Competition took a further hit however as the lender mix shifted back in favour of major lenders who
held 80.4% market share, up from 78.9% in October. First Home Buyers continue to be the most
supportive of non major lenders (28.7%) and investors the least (17.4%).
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

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
Nov 11

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
7,492

$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
$2,970m

$379k
$380k
$379k
$379k
$365k
$382k
$390k
$386k
$388k
$384k
$386k
$384k
$393k
$395k
$396k

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%
38.4%

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%
15.8%

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%
37.8%

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

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

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

77.3%
78.7%
77.5%
74.5%
79.0%
80.5%
78.7%
78.7%
79.8%
80.3%
78.6%
78.8%
78.9%

22.7%
21.3%
22.5%
25.6%
20.9%
19.5%
21.3%
21.3%
20.2%
19.7%
21.4%
21.2%
21.0%

77.6%
79.0%
77.1%
75.0%
79.7%
77.3%
77.1%
76.2%
77.6%
77.8%
70.7%
70.8%
71.3%

22.5%
20.9%
22.9%
24.9%
20.3%
22.8%
22.9%
23.8%
22.5%
22.2%
29.3%
29.2%
28.7%

82.9%
82.4%
82.2%
81.6%
82.2%
83.3%
83.0%
82.9%
83.0%
83.4%
82.8%
82.7%
82.6%

17.1%
17.6%
17.8%
18.4%
17.8%
16.7%
17.0%
17.0%
17.0%
16.6%
17.2%
17.3%
17.4%

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 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
2011 11

AUSTRALIA
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
396,520

NSW
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
449,942

QLD
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
352,252

SA
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
318,437

VIC
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
400,929

WA
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
418,360

NT
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
376,376

WA
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%
67.1%

NT
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%
64.3%

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

TABLE 4: STATE BY STATE
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
2011 11

AUSTRALIA
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%
66.5%

NSW
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%
69.7%

QLD
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%
66.9%

SA
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%
64.5%

www.afgonline.com.au

VIC
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%
66.6%

LOAN T YPE
TABLE 5: ALL AUSTRALIA
MONTH
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
Nov 11

BASIC
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%
8.9%

EQUITY
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%
7.2%

FIXED
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%
17.2%

INTRO
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%
3.5%

STANDARD
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%
63.1%

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
AFG is Australias largest mortgage broker. Established in 1994, the company now provides more than 20%
of brokers nationwide with access to Australias leading lending institutions, and has a mortgage book in
excess of $65 billion.

www.afgonline.com.au