Australian mortgage brokers have fresh momentum from first‑home buyers and investors, even as a deepening housing shortage keeps prices and borrowing needs elevated.
New ABS figures show the number of new first‑home buyer loans jumped 6.8% in the December quarter 2025 to 31,783 – the biggest rise since late 2023 and up 9.1% over the year.
“There was strong growth across all borrower types this quarter. The number of first-home buyer loans rose 6.8%, investor loan numbers rose 5.5%, and the number of owner-occupier non-first-home buyer loans rose 3.6%,” ABS head of finance statistics Mish Tan (pictured) said in a media release.
A separate Westpac analysis underscores how broad-based the lending upswing has become. The bank noted that the value of new dwelling finance approvals, excluding refinancing, rose 9.5% over the quarter, with the number of new loans up 5.1%. Owner‑occupier lending led the charge, delivering a record $65.3bn of new loans funded during the quarter, while investor lending remained strong and accounted for 39% of new lending in 2025 – the highest share since 2017.
The figures come as a new report shows Australia has built around 80,000 fewer homes than needed since mid‑2023, leaving supply lagging federal targets and intensifying competition for stock. Longer‑term projections suggest the nation could undershoot its Housing Accord goals by hundreds of thousands of dwellings, putting further upward pressure on prices in already tight markets.
State‑by‑state, first‑home buyer activity rose in New South Wales (10.9%), Queensland (6.4%), Victoria (3.5%), Western Australia (9.8%), South Australia (4.8%), the ACT (7.1%) and the Northern Territory (3.2%), with only Tasmania recording a small fall (-1.7%). For brokers, that translates into a wider geographic spread of FHB demand, not just a single‑city story.
Affordability pressures, however, are intensifying. The average first‑home buyer loan size jumped a record 8.5% in the quarter to $607,624.
“The size of the average first-home buyer loan rose by a record 8.5% to $607,624 this quarter and was largely driven by first-home buyers in NSW. The Australian Government 5% Deposit Scheme has increased the eligibility criteria for first-home buyers and we are seeing the early effects of this in our data,” Tan said.
Westpac’s analysis suggests the expanded 5% deposit guarantee scheme is also encouraging more buyers to borrow a higher share of the property value, amplifying the lift in average loan sizes.
Investor appetite is also strong. There were 60,445 new investment loans approved in the December quarter, up 5.5% on the previous quarter and 23.6% higher than a year earlier, with total value rising 7.9% to $43.0 billion and average loan sizes lifting to $716,711.
For mortgage brokers, that combination of stronger first‑home buyer and investor demand, record loan sizes, and a persistent supply deficit makes careful serviceability checks, lender selection and guidance around schemes such as the 5% Deposit Scheme more critical than ever.
Get the hottest and freshest mortgage news delivered right into your inbox. Subscribe now to our FREE daily newsletter.
