Mortgage volumes minced by Hayne

Ian Rogers
Blue-sky lending was in the pre-royal commission era
Loans for banks approved through mortgage brokers have settled at around a 50 per cent share of new lending flows, APRA data shows. This is much less than estimates often bandied about during the last year's Hayne-related debates over the industry and its fee structures.

The flow of third-party originated loans declined over the March 2019 quarter to A$36.3 billion from around $45 billion over each of the two prior quarters, yesterday's APRA Quarterly ADI Property Exposures Statistics publication shows.

At $72.4 billion for the March quarter, total new residential term loans to households approved are little more than four-fifths of the volume reported in the March 2018 quarter and three-quarters the level of flows in the June 2018 quarter before the market disruption from the banking royal commission's pursuit of responsible lending themes last year chastened many lenders.

Over the year to March 2019, owner-occupied loan approvals fell 7.2 per cent and investment loan approvals fell 14 per cent, APRA said.

Loans advanced in the two most elevated loan-to-valuation ratio bands have been wound back, down 7 per cent in each band.

The flow of interest-only loans, a once fashionable category, fell 27 per cent, with the proportion of interest-only loans of all mortgage funding down to 23.3 per cent.

The average home loan size was around $277,000 compared with $269,000 a year before, APRA said.