Australian property investors are back in force, driving a surge in activity at leading mortgage aggregator, Australian Finance Group (AFG). According to AFG’s latest Mortgage Index, investor loans reached a 7-year high in Q424, with interest-only loans following suit.
Investor Appetite Skyrockets:
- 32% of all mortgages lodged by AFG brokers in Q424 were for investment purposes – the highest level since FY17.
- Investor loan lodgments surged 16% year-on-year, reaching a staggering $1 billion increase.
Interest-Only Loans Make a Comeback:
- IO loans jumped to 21% of mortgages written in Q424, mirroring the peak observed in FY17.
- This represents a 3-percentage point increase compared to Q423, signaling a renewed preference for this strategy.
National Trend Confirmed:
AFG’s findings echo the national trend identified by the ABS, highlighting a strong appetite for Investment lending. This renewed interest aligns with the current housing market, where limited supply makes property investment an attractive option for capital growth.
Regional Variations Emerge:
However, the report reveals a potential dampener – Victoria’s share of investor loans dipped below the long-term average in Q424. This raises concerns about the impact of recent property tax changes on the state’s attractiveness for investment.
AFG Breaks Records:
Fueled by the investor surge, AFG experienced a record-breaking quarter. Total lodgment volumes reached an astounding $23.3 billion, driven by a surge in broker activity with over 36,395 lodgments.
The Future of Investment Lending
The AFG Mortgage Index paints a picture of a dynamic Australian property market, characterized by a significant rise in investor activity and a return to interest-only loans. While regional variations and potential regulatory interventions are points to consider, this data suggests a booming market for property investment.
Ready to capitalize on this opportunity? Nfinity can connect you with experienced mortgage brokers who can guide you through the investment process. Explore your investment options with Nfinity Financials today at 1300 GET LOAN.
