australian dollars
australian dollars

Qlders ditch major banks to secure home loans

QUEENSLANDERS are leading a seismic shift in how Australians access home loans, with almost half of buyers in ditching the major banks in favour of small lenders.

The nation's big-four banks face tough competition as smaller lenders steal almost half of all home loans, the quarterly Australian Financial Group Index reveals.

In Queensland, 48 per cent of mortgages were taken with non-major lenders in the first quarter of this financial year.

One year ago non-major lenders made up 41 per cent of the total market.

Nationally, non-major banks accounted for 45.9 per cent of lodgements in the September quarter, the highest since 2007.

Macquarie Bank and AMP emerged as the big winners.

"The sector is approaching a 50-50 split between major and non-major lenders, something unheard of five years ago," AFG chief executive officer David Bailey said.

"Consumers are sending a very clear message that they want the choice and the transparency of a competitive home loan market in Australia and mortgage brokers are delivering."

Despite a shift to smaller institutions, Commonwealth Bank remains Queensland's favourite lender, with the nation's largest bank accounting for almost a quarter of loans.

Macquarie Bank was second with 11 per cent of the share.

Queensland's own Suncorp is the state's sixth-largest lender with 5.65 per cent of the share.

The index reveals Queenslanders secured $2.5 billion in home loans in the first quarter of this financial year, the highest since July 2017.

A record $15.7 billion in lodgements were made across Australia in the quarter, a 21 per cent jump on the previous quarter and up 11 per cent on the same period last year.

Queenslanders' average mortgage size was $460,513 - Australia's third-highest behind New South Wales and Victoria - but below the national average of $553,000.

A rebound in the Sydney and Melbourne property markets and changes to lending criteria helped fuel the recovery in national numbers, Mr Bailey said.

"With the impact of further cuts by the Reserve Bank of Australia yet to flow through the market, we anticipate the improved affordability will see positive momentum continue through to the end of the year and into 2020," he said.

"There is no doubt customers are benefitting from the enhanced competition in Australia's home loan market."

Mr Bailey said buyers were also steering away from interest-only loans, with 82 per cent of loans in the September quarter principal and interest loans, the highest proportion in the history of the Index.