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The Reserve Bank of Australia predicts that rapid growth in home loan products with access to offset accounts is likely to continue among new borrowers.
In its latest Statement on Monetary Policy, released last week, the RBA noted that offset account balances currently amount to around $90 billion, equivalent to over six per cent of housing loans outstanding.
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The RBA noted that offset account balances have been growing by approximately 30 per cent annually over recent years.
“This growth has the potential to continue as older loans that are less likely to have offset accounts are replaced with new loans, where it is more common to have an offset account,” the RBA said.
“Available redraw balances, at around $120 billion, are larger than offset account balances, but have grown at a pace closer to 10 per cent over recent years.”
Since offset account balances have been growing much more rapidly than housing credit, net housing debt is growing more slowly than housing credit; over the six months to June, annualised net housing debt growth was around six per cent, compared to seven per cent for housing credit growth, according to the central bank.
“The effect is slightly larger for credit extended to investors than to owner-occupiers, reflecting the fact that investor offset account balances have grown more quickly than balances for owner-occupiers,” it said.
“Offset account balances have also been making a significant contribution to household deposit growth; excluding offset account balances reduces growth in household deposits by around 1 percentage point to 7.5 per cent.”
[Related: Home loan demand on the rise]
