Mortgage demand has surged to its highest level since 2021, according to new data from Equifax, even as affordability challenges continue to hold back actual lending growth.
Equifax reports that mortgage enquiry levels climbed sharply in the September quarter, but the number of new mortgage accounts opened fell year-on-year.
“Mortgage demand is strong; however, we are facing an affordability threshold challenge,” said Moses Samaha (pictured), executive general manager at Equifax. “For the second consecutive quarter, new accounts opened are down year-on-year, indicating a barrier to entry.”
Samaha said the recent run of RBA cuts has helped ease pressure but hasn’t solved deeper affordability problems. The Reserve Bank this week kept the cash rate steady at 3.6%, following three cuts earlier in 2025.
“With three cash rate cuts this year, lower rates have provided some relief for mortgage holders, however they are not a solution to underlying affordability issues created by increasing property prices,” he said.
Samaha added that while many borrowers now have deposits ready and access to support such as the expanded 5% Deposit Scheme, higher property prices are testing lender limits.
“Borrowers have their deposits ready, and many first-home buyers even have access to assistance through schemes such as the government's expanded 5% Deposit Scheme,” he said.
“However, increased house prices demand larger loan amounts, and this means higher LVRs that are pushing borrowers beyond the qualifying affordability criteria.”
Equifax’s latest data shows:
RBA noted that while earlier rate cuts have supported growth, lingering inflation and external risks warranted a cautious stance heading into 2026.
The combination of lower borrowing costs and persistent price pressures has created what Samaha calls a “demand versus affordability gap” — one that continues to define Australia’s housing and lending market.
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