CANBERRA, AAP – Demand for home loans jumped to another record high in January, even as house prices were rising at their fastest pace in almost 18 years.

Australian Bureau of Statistics figures show new loan commitments rose to a record $28.8 billion in January, with mortgages for owner-occupiers 52.3 per cent higher than a year earlier.

ABS head of finance and wealth Katherine Keenan said since the federal government’s HomeBuilder grant was introduced in June 2020, there has also been a record rise in construction loans.

At the same time, loans granted to first home buyers rose by 9.6 per cent, the highest level since May 2009 when the then first home owner grant was tripled in response to the global financial crisis.

Record low mortgage rates, improving economic conditions and government incentives propelled houses 2.1 per cent higher in February, the largest national rise since August 2003.

Housing analysts CoreLogic say housing values are rising across every capital city and state region, a synchronised growth phase that hasn’t been seen in Australia for more than a decade.

The last time this occurred for a sustained period was mid-2009 through to early 2010, as post-GFC stimulus fuelled buyer demand, CoreLogic’s research director Tim Lawless said.

The CoreLogic national home value index showed Sydney and Melbourne were among the strongest markets in the month, rising 2.5 per cent and and 2.1 per cent respectively, as Australia’s two largest cities caught up from weaker performances through 2020.

Mr Lawless said both cities are still recording values below their earlier peaks and it is unclear whether this new found growth can be sustained.

“However, at this current rate of appreciation it won’t be long before Australia’s two most expensive capital city markets are moving through new record highs,” he said.

“With household incomes expected to remain subdued and stimulus winding down, it is likely affordability will once again become a challenge in these cities.”

Regional markets were 2.1 per cent up over February, remaining ahead of their capital cities counterparts, up two per cent.

Regional areas generally recorded less of a decline in housing values through the worst of the COVID period last year, while also showing an earlier and stronger growth trend through the second half of last year.

This regional preference is reflected in the annual growth rate, where the combined regionals index was 9.4 per cent higher while the combined capital city index is up by a much smaller 2.6 per cent.


National – up 2.1 per cent

Sydney – up 2.5 per cent

Melbourne – up 2.1 per cent

Brisbane – up 1.5 per cent

Adelaide – up 0.8 per cent

Perth – up 1.5 per cent

Hobart – up 2.5 per cent

Darwin – up 0.7 per cent

Canberra – up 1.9 per cent

Combined capitals – up 2.0 per cent

Combined regional – up 2.1 per cent