Household Lending Market Report 2025

The household lending market size has grown strongly in recent years. It will grow from $5.03 trillion in 2024 to $5.53 trillion in 2025 at a compound annual growth rate (CAGR) of 9.8%. The growth in the historic period can be attributed to interest rates and monetary policy, economic conditions and employment trends, government policies and housing programs, consumer confidence and spending habits, credit market conditions and risk appetite.

The household lending market size is expected to see strong growth in the next few years. It will grow to $8.06 trillion in 2029 at a compound annual growth rate (CAGR) of 9.9%. The growth in the forecast period can be attributed to demographic trends and population dynamics, societal shifts in financial behavior, global economic factors and trade dynamics, innovations in loan products and structures. Major trends in the forecast period include use of alternative credit scoring models, shift towards securitization of household loans, implementation of open banking, focus on responsible and ethical lending practices, and integration of blockchain technology.

The significant surge in housing costs is poised to drive the expansion of the household lending market in the foreseeable future. Housing costs encompass rent and mortgage expenses, including principal repayment and mortgage interest, as well as additional charges for obligatory services, routine maintenance, repairs, taxes, and utility bills. The escalating housing costs limit individuals' ability to make a full cash payment for a house, prompting them to seek loans. The increasing housing costs are therefore contributing to the growth of the household lending market. For instance, in November 2022, the Federal Housing Finance Agency reported a 12.4% increase in home prices in the United States between the third quarters of 2021 and 2022. Compared to the second quarter of 2022, home prices saw a 0.1% increase. Hence, the substantial spike in housing costs is a driving force behind the household lending market.

A decline in interest rates is expected to be a catalyst for the household lending market during the forecast period. A decrease in interest rates implies a reduction in the cost of borrowing money, typically influenced by central banks or market forces. Lower interest rates make borrowing more affordable, stimulating demand for various lending products such as mortgages, personal loans, and home equity loans. Reduced interest rates also make home purchases more attractive to potential buyers. For example, according to Trading Economics, interest rates in the USA are projected to decrease from 4.75% in 2024 to 3.50% in 2025. Therefore, the fall in interest rates is anticipated to drive the growth of the household lending market.

Major companies in the household lending market are concentrating on developing innovative solutions, such as end-to-end digital home loans, to simplify the borrowing process. An end-to-end digital home loan refers to a completely online procedure for applying, approving, and managing a home loan without the necessity for physical paperwork or in-person meetings. For example, in November 2023, Australia and New Zealand Banking Group Limited, a financial services company based in Australia, launched a new end-to-end digital home loan via its ANZ Plus mobile app, specifically targeting eligible owner-occupiers in metropolitan New South Wales and Victoria for refinancing. This innovative service facilitates rapid approvals, often within minutes, and offers upfront property valuations. With a competitive variable interest rate of 6.14%, the loan process is streamlined and user-friendly, allowing customers to easily track their applications.

Major companies in the household lending market are concentrating on increasing their investment in the home lending sector. The home lending business entails providing loans or mortgages to individuals or entities for the purchase of residential properties. For instance, in October 2023, Wells Fargo, an American multinational financial services company, established a more focused Home Lending division aimed at serving bank customers, as well as individuals and families in minority communities, in an effort to mitigate risk in the mortgage sector by resizing and narrowing its focus. Notably, the company is exiting the Correspondent business and intends to downsize its Servicing portfolio. These initiatives build on the progress the company has made over the past three years to simplify its operations in this area.

In March 2023, Barclays PLC, a UK-based multinational bank, acquired Kensington Mortgage Company Limited to strengthen its mortgage product portfolio. The acquisition integrated a specialized mortgage lender with a strong reputation in the UK market, aligning with Barclays' strategic goal of delivering next-generation, digital consumer financial services. Kensington Mortgage Company Limited specializes in providing mortgages for first-time buyers, self-employed individuals, contractors, and others.

Major companies operating in the household lending market include Bank of America Corporation, JPMorgan Chase & Co., Pentagon Federal Credit Union, Discover Financial Services Inc., LoanDepot.com LLC, Spring EQ LLC, Australia and New Zealand Banking Group Limited, Barclays plc, Citizens Commerce Bancshares Inc., Commonwealth Bank of Australia, Flagstar Bancorp Inc., HSBC Holdings plc, Navy Federal Credit Union, Roostify Inc., Royal Bank of Canada, Alltru Credit Union, American Express Company, Earnest Inc., Figure Technologies Inc., Even Financial Inc., First Tech Federal Credit Union, Happy Money Inc., Kikoff Inc., Klarna Bank AB, LendingClub Corporation, LendingUSA LLC, Mission Lane LLC, The Goldman Sachs Group Inc., Mariner Finance LLC, MoneyKey Inc., MoneyLion Inc., M&T Bank Corporation, Enova International Inc., OneMain Financial Holdings Inc., Oportun Inc., OppFi Inc., Peerform Inc., PNC Financial Services Group Inc., Prosper Marketplace Inc.

North America was the largest region in the household lending market in 2024. The regions covered in the household lending market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the household lending market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Household lending involves the practice of lending money for the purpose of purchasing a home or managing household-related expenses. The borrower is obligated to repay the borrowed funds along with interest, adhering to the agreed-upon loan repayment plan. Household lending serves as a means to augment the budget for acquiring a home by leveraging the loan amount provided.

The primary types of household lending encompass fixed-rate loans and home equity lines of credit, both of which can be obtained from various financial institutions such as banks, online lenders, and credit unions. In a fixed-rate loan, the interest rate remains constant for the entire duration of the loan or a specified period. Sources of household lending include mortgage and credit unions, as well as commercial banks. Interest rates associated with household lending include fixed-rate mortgage loans and adjustable-rate mortgage loans.

The household lending market research report is one of a series of new reports that provides household lending market statistics, including household lending industry global market size, regional shares, competitors with a household lending market share, detailed household lending market segments, market trends and opportunities, and any further data you may need to thrive in the household lending industry. This household lending market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The household lending market includes revenues earned by entities by providing conventional loans, secured and unsecured loans, and open-end and closed-end loans to borrowers for household lending. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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