Mortgage lending reaches all-time high in big bank cash backs frenzy

The latest Reserve Bank data for the residential mortgage lending by purpose data series shows changes in loan provider spiked up to $5.78 billion, or 41.1% of the total $14 billion lent in December – record numbers in the series. It was an increase of 169.2% compared to December 2024.

Banks had offered a 1.5% cash back for new mortgages and mortgage advisers reported a flurry of activity from mortgage holders due to refix in December and others breaking their existing terms to get the offers of up to $30,000.

Mortgage holders changing their loan provider in large part drove the total lending figure of $14 billion – an all-time high. The last time it came anywhere near this was at its March 2021 pandemic peak when the total reached $10.5 billion.

Also at a record high was the average size of loans at $718,000.