Borrowers in four states continue to rely on non-major financial institutions for new housing loans, according to the latest report from PEXA.
The report showed non-major lenders in NSW, Queensland, Victoria, and WA continued to grow their share of the market as they tally increasing numbers of new mortgages in July.
In NSW, non-majors have finally overtaken major banks in net monthly position for new loans. This leaves Victoria as the only state where non-banks have yet to beat majors for new loans.
However, major banks in Victoria reported a sharp fall in their net positions, narrowing the gap with non-major lenders.
Big banks also registered a steep decline in Queensland, further widening their gap from non-majors. The same trend was also apparent in WA.
Different story for refinancers
For refinancing activity, major banks made a positive swing in NSW while non-majors took a sharp downfall during the month. Despite this, non-majors still hold the dominant share in refinancing in the state.
In WA, major banks remained on an uptrend while non-majors continued to lose their share of the market.
Divergence also grew in Queensland, although it was the non-majors that were on the upside while big banks lose their foothold.
The gap between majors and non-majors in Victoria continued to expand in the month. Since outpacing majors in March, non-major lenders have steadily improved their market share.
Refinancers up, new loans decline
The PEXA study showed that refinancers were more active than new borrowers during the month.
In fact, sale settlements with new loans declined across all states. Queensland hit the highest monthly drop at 6.2% while NSW posted the smallest decrease at 0.6%.
On the other hand, all states witnessed increased level of refinancing activity from the previous month, with the four states reporting gains of 7.5% to 8.8%.