The value of new housing loan commitments was down 11.6 per cent in May compared with the previous month – the biggest fall in the history of the ABS series.

The value of loan commitments for owner occupiers fell 10.2 per cent, while loan commitments for investors fell 15.6 per cent. The value of new loan commitments for investors is at its lowest level since 2002.

The ABS said big falls in New South Wales and Victoria were the key factors in the latest figures. It said fewer transactions in the housing market stifled loan activity.

The segment of the housing finance market that was active was owner occupier refinancing, which was the highest on record. Refinancing rose 27.5 per cent month-on-month.

The ABS said borrowers were responding to falling interest rates and refinancing offers.

First home buyers, who have been active in the market so far this year, accounted for 31.7 per cent owner occupier commitments (excluding refinance) – a fall 9.3 per cent compared with the previous month.