CANBERRA, Nov. 11 (Xinhua) -- The value of new Australian home loans recorded the largest fall on record in the third quarter of 2026 amid the fastest housing market downturn in 40 years, according to new data.
The Australian Bureau of Statistics (ABS) said on Wednesday that the number of new home loans fell by 15.0 percent between the second and third quarters, while the total value of new home loans declined by 15.5 percent to 81.2 billion Australian dollars (55.9 billion U.S. dollars).
The statistics bureau said that the quarterly decline in new home loan value was the largest since records began in 2002.
It said that the decline was driven by a 30.6 percent fall in the number and a 32.3 percent fall in the value of new investor home loans.
The number of new loans to owner-occupiers declined 5.3 percent in the third quarter.
"While lending activity fell across all borrower types in the September quarter, the decline was sharpest for investors. Our data suggests that investor activity is being influenced by factors beyond increasing borrowing costs, including the potential impacts of tax changes and expectations of lower house prices," Mish Tan, head of finance statistics at the ABS, said.
Figures released at the start of November by property data firm Cotality revealed that the national median house price fell by 1.2 percent in October, marking the seventh consecutive month of decline.
Cotality said that the national median house price had fallen by 6.7 percent from its March peak, wiping 63,400 AUD (43,650 USD) in value off the median dwelling, with the decline tracking at the fastest pace of any downturn in the last 40 years.
Tim Lawless, research director at the firm, attributed the downturn to headwinds including interest rate hikes, persistently low confidence, cost-of-living pressures and a move by the federal government to wind back tax concessions for property investors.
Australia's central bank, the Reserve Bank of Australia, on Nov. 3 raised its key interest rate by 0.25 percentage points for the fifth time in 2026 to an 18-year high of 4.85 percent, citing elevated inflation driven by the conflict in the Middle East.
The nation's big four consumer banks all subsequently passed on the rise to customers with variable rate home loans.
The Commonwealth Bank, Australia's largest bank, said in a trading update on Wednesday that the proportion of home loans with payments more than 90 days overdue increased by seven basis points to 0.80 percent.
The bank reported an unaudited cash profit of 2.8 billion AUD (1.9 billion USD) for the third quarter, up eight percent year-on-year, despite a 16 percent fall in new home loan applications.
CEO Matt Comyn said in the update that higher inflation and interest rates are putting uneven pressure on household incomes and business activity, but the Australian economy remains resilient, supported by low unemployment and strong public infrastructure and private investment pipeline.
The RBA's Monetary Policy Board will meet one more time in 2026 to consider adjusting interest rates in early December. ■