There were no signs of more relaxed home lending from the banks in December despite them being aware that the cap on low equity loans was due to rise.
Figures from the Reserve Bank show the banks lent $5.37 billion at the end of last year to property buyers bringing total lending for the year to $64.3b up nearly 9 per cent on 2017.
But banks did not get close to the cap of 15 per cent of lending to low equity owner-occupiers in December despite knowing that from January 1 the cap would be increasing to 20 per cent.
Excluding exemptions, just 9.8 per cent of loans to owner-occupiers were done to those with a deposit of less than 20 per cent.
Including exemptions, it was 14 per cent.
Kelvin Davidson, a research analyst at CoreLogic, said given banks were already running below the cap they could have taken the opportunity in December to push up much closer to it knowing the new cap was coming.
"To us, this simply reinforces our hunch that the looser speed limits may not produce much of a rise in actual lending in 2019."
Davidson predicted mortgage lending flows would remain solid this year.
"But any further increase in activity is likely to be slow and steady rather than spectacular."
Davidson said a decent proportion of lending increases seemed to be driven by higher approval rates and suggested that only the best borrowers - those with a deposit of a least 20 per cent and the ability to service debt at higher interest rates - were coming forward.
"It remains to be seen just how many of these high-quality borrowers are left."
Davidson said banks were also being faced with the prospect of having to hold on to more capital in the future under proposed changes by the Reserve Bank.
But there was some good news in the December figures - the share of "risky" interest-only lending continues to fall and was below 30 per cent - well down on previous peaks of 40 per cent.
Davidson said it was a drop in interest-only loans to investors that was mainly driving the fall although it was also lower for owner-occupiers.
Of the $5.37b lent just $493 million went to those with a deposit of less than 20 per cent.
Investors loans stood at $1.9b while owner-occupier lending was valued at $3.47b.