Invest
‘Major structural change’ in property landscape
Lenders are moving away from property investors and towards upgraders, representing a “major structural change” in the landscape, new data reveals.
‘Major structural change’ in property landscape
Lenders are moving away from property investors and towards upgraders, representing a “major structural change” in the landscape, new data reveals.
The latest Mortgage Index results from aggregator service, AFG paint "a very different picture from this time last year”, said AFG CEO, David Bailey.
“Regulator-led tightening of investor lending has led to a further drop in investor volume and they are now sitting at an all-time low of 29 per cent of the market.”
The Australian Prudential Regulation Authority in March introduced measures designed to crack down on investor lending in response to an "environment of heightened risks". The regulator directed lenders to keep new interest-only lending to below 30 per cent of all new residential lending. Lending to investors was also to remain below a 10 per cent growth speed limit.
"The national average home loan is now sitting at an all time high of $491,000,” said Mr Bailey.
“This increase can be explained by the fact that people generally spend more for their primary place of residence than they do for an investment property."
At 29 per cent, the proportion of investor lending in the first quarter of the 2018 financial year is 3 per cent lower than the proportion in the same quarter last year.
Going back further to the first quarter of FY15 shows a drop of 10 per cent, from 39 per cent. Correspondingly, the proportion of upgrader loans has grown from 31 per cent in the first quarter of FY15 to 41 per cent.
The percentage of those looking for refinance also dropped to 25 per cent from 29 per cent in the last quarter of FY17.
"This is also likely to be a reflection of the lack of lending options on the table for investors wanting to refinance, as lenders pull back from the investor market to meet regulator demands,” Mr Bailey explained.
He continued: "Looking at loan type, fixed rates are now at 26.3 per cent of all loans which confirms many Australians are anticipating that the next interest rate move will be up.”
Mr Bailey also noted the fact that first home buyers are "enjoying" their third quarter in a row of filling out a double digit proportion, rising from 10 per cent of the market in both the third and fourth quarters of FY17 to 13 per cent in the most recent.
"National market share for first home buyers has lifted to 13 per cent across the last quarter, helped in part by new stamp duty concessions kicking in on 1 July for this segment of the market in Victoria and NSW.”
The results coincide with Sydney house prices falling for the first time in nearly three years. According to Domain's latest State of the Market Report, Sydney's housing market has experienced its first decline since December 2015.
“Generally, weaker capital city house price growth over the September quarter is reflected in the national results,” said Domain’s chief economist, Dr Andrew Wilson.
“House price growth is expected to continue to ease in most capital cities over the remainder of the year, although the underlying drivers remain positive.”
RELATED ARTICLES
Property
Twice the demand: the case study behind Melbourne’s first‑home buyer surge
Melbourne has quietly engineered one of Australia’s most consequential housing turnarounds, with first‑home buyer demand running at roughly double the national pace and four of the top five buyer ...Read more
Property
First‑home buyers now anchor Australia’s mortgage growth — but the risk maths is changing
Great Southern Bank’s revelation that nearly one in three of its new mortgages went to first‑home buyers is not an outlier. It is the leading edge of a broader market realignment powered by government ...Read more
Property
Home guarantee scheme shake-up challenges Australia’s housing market players
From 1 October 2025, the expanded Home Guarantee Scheme (HGS) materially widens what first-home buyers can purchase and where. By sharply lifting price caps and relaxing eligibility settings, the ...Read more
Property
GSB’s first‑home buyer play: turning policy tailwinds into market share
Great Southern Bank’s latest results show that nearly one in three of its new mortgages now go to first‑home buyers—evidence of a fast‑moving market reshaped by government guarantees, easing rates and ...Read more
Property
Why investors are fleeing and renters are scrambling in Australia's housing maze
Australia’s rental market is tightening even as individual landlords sell down. New data points to a multi‑year investor retreat tied to higher holding costs and regulatory uncertainty, while prices ...Read more
Property
Australia's 5% deposit guarantee: Unlocking gains while balancing risks in the market share race
Can a bigger government guarantee fix housing access without fuelling prices? Australia is about to find out. The Albanese government’s expanded 5% deposit pathway aims to help 70,000 buyers, remove ...Read more
Property
Australia's bold move the 5% deposit scheme shaking up the housing market
Can a government guarantee replace lenders mortgage insurance without inflating prices or risk? Canberra’s accelerated 5% deposit scheme is a bold demand-side nudge in a supply‑constrained marketRead more
Property
When rates drop but stress sticks: exploring Australia's mortgage arrears dilemma
Headline numbers suggest arrears ease as rates come down. The reality in Australia is messier: broad measures dipped into mid‑2025, yet severe delinquencies and non‑bank portfolios remain under ...Read more
Property
Twice the demand: the case study behind Melbourne’s first‑home buyer surge
Melbourne has quietly engineered one of Australia’s most consequential housing turnarounds, with first‑home buyer demand running at roughly double the national pace and four of the top five buyer ...Read more
Property
First‑home buyers now anchor Australia’s mortgage growth — but the risk maths is changing
Great Southern Bank’s revelation that nearly one in three of its new mortgages went to first‑home buyers is not an outlier. It is the leading edge of a broader market realignment powered by government ...Read more
Property
Home guarantee scheme shake-up challenges Australia’s housing market players
From 1 October 2025, the expanded Home Guarantee Scheme (HGS) materially widens what first-home buyers can purchase and where. By sharply lifting price caps and relaxing eligibility settings, the ...Read more
Property
GSB’s first‑home buyer play: turning policy tailwinds into market share
Great Southern Bank’s latest results show that nearly one in three of its new mortgages now go to first‑home buyers—evidence of a fast‑moving market reshaped by government guarantees, easing rates and ...Read more
Property
Why investors are fleeing and renters are scrambling in Australia's housing maze
Australia’s rental market is tightening even as individual landlords sell down. New data points to a multi‑year investor retreat tied to higher holding costs and regulatory uncertainty, while prices ...Read more
Property
Australia's 5% deposit guarantee: Unlocking gains while balancing risks in the market share race
Can a bigger government guarantee fix housing access without fuelling prices? Australia is about to find out. The Albanese government’s expanded 5% deposit pathway aims to help 70,000 buyers, remove ...Read more
Property
Australia's bold move the 5% deposit scheme shaking up the housing market
Can a government guarantee replace lenders mortgage insurance without inflating prices or risk? Canberra’s accelerated 5% deposit scheme is a bold demand-side nudge in a supply‑constrained marketRead more
Property
When rates drop but stress sticks: exploring Australia's mortgage arrears dilemma
Headline numbers suggest arrears ease as rates come down. The reality in Australia is messier: broad measures dipped into mid‑2025, yet severe delinquencies and non‑bank portfolios remain under ...Read more
