In the March quarter, the number of new finance commitments to first home buyers dropped 22.5 per cent to 18,348, according to the report. Compared to the first quarter of 2012, new finance commitments to first home buyers decreased by 21.3 per cent.

In addition, South Australia was the only state to record a rise in the number of loans to first home buyers over the quarter, with the largest drops recorded in Queensland and New South Wales at 43.2 per cent and 40.6 per cent respectively.

Compared to the March 2012 quarter, the number of loans to first home buyers decreased in New South Wales and Queensland, while Western Australia recorded the largest increase, up by 19.2 per cent, according to the report.

However, the average loan size to first home buyers increased 1.0 per cent over the quarter and 4.1 per cent compared to the March quarter of the previous year. The largest quarterly decline was recorded in the Australian Capital Territory, decreasing 4.2 per cent.

Compared to the March quarter of the previous year, Tasmania and the Northern Territory each recorded declines in the average loan size to first home buyers, with decreases of 1.3 per cent and 0.6 per cent respectively.