According to the latest edition of Money.com.au’s Mortgage Insights, the number of investor loans has risen by 22% nationwide over the last year to 192,843, significantly outpacing the 6% increase in owner-occupier loans, which totalled 322,273.
This surge comes as borrowing power improves, driven by the Reserve Bank’s first official cash rate (OCR) cut since 2020, which has begun to shift market dynamics, with buyers regaining confidence, auction clearance rates rising, and property prices gradually rebounding.
Projections suggest that by 2025, investor loans could escalate to around 234,000 nationwide, whereas owner-occupier loans might reach approximately 341,000.
For the first time in two years, the growth in investor loans in Victoria has matched the rise in owner-occupier loans, with both categories increasing by 10%.
The investor segment, particularly fueled by a 22% rise in construction loans, shows a robust upward trend despite the decline in loans for new housing by 20%.
In New South Wales, investor loans surged to a record high last year, making up 41.7% of all new loans. This significant increase, primarily driven by a 34% rise in loans for newly built properties, marks the highest share for investor loans in the state over the past five years.
The average loan size for new properties in NSW is notably higher at $872,306, compared to $827,099 for existing homes.
Queensland has seen substantial growth in investor lending, recording a 26% increase from the previous year.
The state now accounts for 40% of all new loans being made to investors, a considerable rise from 22% four years ago.
This growth is spread across loans for existing properties, land, and construction, solidifying Queensland’s position as a burgeoning hub for property investment.
Investor loans in South Australia have reached a new peak, with a record 13,685 loans noted last year.
This rise of 22% in investor lending highlights a market shift, with investor loans now representing 39% of all loans for existing properties.
However, owner-occupier loan volumes have significantly declined, remaining well below the peaks of previous years.
Western Australia experienced the highest growth in investor loans, which surged by 35% to 25,660.
The state leads in growth across all types of investor loans, including land purchases and construction, with annual increases of 64% and 54% respectively.
This investor-led boom is reshaping the lending landscape in Western Australia.
Tasmania remains the most conservative state in terms of mortgage volumes, with total loans still 28% below the 2021 peak.
With investor loans constituting only 26% of the market, Tasmania lags behind other states, indicating a slower recovery in the housing loan sector, Money.com.au reported.
