Australia Sees Sharp Decline in Home Loans Amid Interest Rate Hikes

Australian home loans dropped 5.4% in the June quarter of 2026, according to data released by the Australian Bureau of Statistics (ABS).

The total number of new home loans fell to 134,225 during this period, while the total value of these loans decreased by 5.2%, or $5.4 billion.

Lending to investors was particularly affected, with a decline of 8.6% in the June quarter and annual growth slowing from 19.4% in March to 2.8%. This was led by declines in New South Wales (-15.5%), Victoria (-14.2%), and Queensland (-10.1%).

The Reserve Bank of Australia's third cash rate increase in 2026, as well as changes to negative gearing and capital gains tax announced in the federal budget, may have contributed to these declines.