Non-Bank lending surges as borrowers seek more choice
Non-bank lenders are taking a much bigger share of Australia's home lending market, giving borrowers more choice at a time when traditional lending conditions have tightened.
A Money.com.au analysis of Australian Bureau of Statistics data shows non-bank lenders issued $10.49 billion in new home loans in the June quarter, up 65.2% year-on-year. Their share of new home lending has reached 10.7%, compared with just 4.8% when the data series began in 2019.
The growth is particularly notable because total new housing lending fell 5.2% over the quarter, while non bank lending increased 3.2%.
That expanding choice could be particularly valuable for property investors whose borrowing capacity has been squeezed by higher rates and tighter lending conditions. Non-banks can have different serviceability requirements and lending policies. That could give some investors greater borrowing capacity when traditional bank criteria limit their options, helping them continue building their portfolios.
With non-banks now accounting for more than $1 in every $10 of new home lending, looking beyond the major banks could uncover additional ways to finance the next purchase and continue building a Sydney property portfolio.
About the author – Alex Veljancevski is a Sydney Mortgage Broker with Eventus Financial, which assists first home buyers, investors, upgraders and borrowers seeking to refinance to a better deal on their home loan.
