NAB's Mortgage Book Shrinks as Lending Cools

Fresh APRA data shows Australia's biggest banks almost stalled in July, with NAB recording its first mortgage-book decline since July 2024.

Australia's home-lending market reached a new low-water mark in July 2026, with fresh APRA data showing the country's 10 largest authorised deposit-taking institutions (ADIs) grew their combined housing-loan books by just $6 billion for the month — a figure heavily dependent on a single lender.

The Adviser's analysis of APRA's monthly ADI statistics found that Macquarie Bank alone accounted for $2.22 billion of that total. Strip out Macquarie, and the aggregate growth from the remaining nine lenders was far more subdued — with multiple banks recording outright declines, and NAB edging into negative territory for the first time since July 2024.

The Majors Slow to a Crawl

The Commonwealth Bank retained its position as Australia's largest mortgage lender, with a total housing portfolio of $637.5 billion at the end of July. But growth slowed dramatically, with CBA adding just $1.20 billion during the month — a 0.31 per cent rise — compared with a $5 billion expansion in June. Owner-occupied lending drove the modest gain, rising $1.54 billion to $414.9 billion, while investor balances increased a more modest $420 million to $222.5 billion.

Westpac's $518 billion mortgage book was nearly flat, rising just $340 million — 0.07 per cent — compared with a $2.78 billion gain in June. Westpac's owner-occupied lending rose $770 million to $342.6 billion, but its investor portfolio fell $430 million to $175.4 billion, reversing a $1.32 billion gain from the previous month.

NAB's mortgage book slipped $50 million to $351.5 billion — a 0.01 per cent fall, but notable as the bank's first outright decline since July 2024. Owner-occupied balances decreased $120 million to $236.2 billion, while investor balances dropped $70 million to $115.3 billion.

ANZ was the strongest performer among the big four, with its portfolio rising $1.04 billion to $331.9 billion. Yet even ANZ's growth was about one-third of the $3.12 billion it added in June, with investor lending rising $600 million to $113.6 billion.

Macquarie Stands Apart — Smaller Banks Contract

Macquarie Bank again stood clearly apart from the rest of the market. Its $185.9 billion mortgage book grew $2.22 billion — 1.21 per cent — in a month when the major banks were largely treading water. The lender added $1.61 billion to owner-occupied lending and $600 million to investor balances, accounting for more than half of the named lenders' combined net growth. Even Macquarie's pace moderated from June, when it expanded 1.88 per cent and added $3.39 billion.

ING continued to grow at a measured pace, lifting its portfolio $330 million to $74.5 billion, with owner-occupied lending rising $240 million to $55.6 billion.

Among the regional banks, the picture was more challenging. Bank of Queensland recorded the steepest percentage contraction among the top 10, with its home loan book falling $440 million — 0.87 per cent — to $50.7 billion. HSBC's portfolio dropped $200 million to $34.9 billion; the bank agreed in late July to sell its approximately $36 billion Australian home and personal loan portfolio to Blackstone, with completion expected in the first half of 2027. Bendigo and Adelaide Bank's book eased $30 million to $64.5 billion, while Suncorp Bank declined $280 million to $56.7 billion — a 0.49 per cent fall that continues the contraction accompanying its progressive integration into ANZ.

What's Driving the Slowdown

Three consecutive RBA cash-rate rises earlier in 2026, combined with the federal government's May budget changes to investor property-tax settings, have significantly cooled demand across the mortgage market. The Adviser reports that ANZ's own application data showed underlying mortgage values fell 12 per cent between the 12 May budget and late July, with Westpac, CBA, and NAB also reporting softer post-budget application flows.

The result is a market where lenders are competing for a smaller pool of active borrowers. For property investors reassessing their loan structure in the current environment, our investor home loans comparison shows which lenders remain competitive. Owner-occupiers who haven't reviewed their rate recently can use our refinance savings calculator to quantify what a switch might save.

The broader message from the July APRA data is that when credit growth slows, lenders tend to compete harder for the borrowers who are willing to move. The leverage is with those who know what their options are and are prepared to act on them.

The Adviser's full APRA data analysis is available here.

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