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Soaring home prices across Melbourne and Victoria have led to record home loans.

Victorians are taking on record levels of debt to own a home, with the state’s average loan closing on $620,000.

November figures released by the Australian Bureau of Statistics this week show a 9.7 per cent lift in owner occupier loans issued, as Melbourne’s housing market shook off the city’s last lockdown.

The $6.279bn total accounted for almost 20 per cent of the $31.5bn month of home loans recorded by the ABS around the nation.

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Victoria also had the most first-home buyers in the nation in November, up 12.3 per cent to 3953, but their numbers have plunged from almost 5000 in January last year.

ABS finance and wealth head Katherine Keenan said Victoria’s rise in owner-occupier loans was the strongest in the country, “corresponding with restrictions easing” in October and November.

Borrowers appear to be increasingly comfortable with bigger loans.

But the rise in owner-occupier demand came with a rise in costs for buyers, with the data also showing Victoria’s typical home loan size in November was a record $618,602 — about $80,000 more than the $540,000 typical loan recorded in January 2021.

Real Estate Buyers Agents Association of Australia president Cate Bakos expected future data releases to show buyers taking on even bigger loans, noting demand had remained high despite Melbourne hosting its biggest December auction market on record in the final weeks of 2021.

Auction pic

Scott Patterson auctioning a Balwyn home in December. Picture: Rob Leeson

“If that underlying demand is still there, and I believe it is, I think we will see people pushing even harder,” Ms Bakos said.

The national average home loan is now sitting at $595,568, according to the ABS, and is largely being dragged up by NSW where the typical loan in November was $769,459.

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