Healthy start to the year
Each month we invite mortgage advisors around the country to give insights into developments in the residential real estate market from their unique perspective. Our latest survey has attracted 54 responses.
The main themes to come through from the statistical and anecdotal responses include the following.
First home buyers are maintaining a strong presence in the mortgage financing market, but investors continue to take a back seat.
Lending criteria continue to be eased in a sporadic manner with sometimes high variations between the main lenders.
Compared with a month ago, are you seeing more or fewer first home buyers looking for mortgage advice?
A net 33% of mortgage advisors report that they are seeing more first home buyers in the market looking for advice. This is little changed from our previous survey two months ago early in December but down from the short-lived spike to 55% in November.
Young buyers continue to take advantage of a real estate market replete with listings and with minimal upward price movement.
Comments on bank lending to first home buyers submitted by advisors include the following.
Although interest rates have been slowly increasing, test rates have remained in place, so approvals are amounts that more clients are able to purchase for with some negotiation at the moment.
Clean credit is a must.
Preapprovals are back and turn around times are shortened which is awesome.
Far easier to obtain lending, and banks want to workshop applications.
More chance with a 10% deposit. Need regular income not casual contractors, same industry for 2 years.
Compared with a month ago, are you seeing more or fewer investors looking for mortgage advice?
For the first time since August 2023 our survey shows more mortgage advisors saying they are seeing fewer investors than say they are seeing more. The net -6% result compares with a positive net 22% recorded two months ago.
There is no evidence of strong upward movement in house prices which would normally cause investors to accelerate any purchase plans they might have. There also appears to be growing realisation that average capital gains in the long-term will not be what they were in the past, plus awareness of rising costs of running a rental property business and altered access to credit.
Nonetheless, comments submitted by advisors indicate that there is still investor presence in the market.
Comments made by advisors regarding bank lending to investors include the following.
Banks have increased lending to investors with > 70% LVR.
One major lender now (limited time) lending up to 85% on investment property.
Banks are offering loans for over DTI of 7.
Some willingness to lend outside DTI/LVR restrictions but for my clients I haven’t had the need to utilise this.
Compared with a month ago, are you finding lenders more or less willing to advance funds?
A net 26% of mortgage brokers have indicated that lenders are becoming more willing to advance funds for home purchases. This is down from 39% two months ago and 49% three months back but still consistent with the more relaxed lending environment which appeared from the early part of 2023.
What time period are most people looking at fixing their interest rate?
In our first survey for 2026 75% of mortgage advisors have reported that borrowers primarily favour fixing their interest rate for two years. Interest in other terms is minor.
Few borrowers any longer indicate they will fix one year whereas as recently as October 82% of advisors said this was the preferred term.
The preference for fixing two years has soared back to levels last seen very briefly just junder a year ago.
There was a short-lived burst of interest in fixing five years late last year. But that has now vanished.
Are more property owners asking about refinancing?
After soaring to an unusually high net 76% of brokers two months ago saying that more people were asking about refinancing it is perhaps not surprising that some of that surge to take advantage of cashback offers has eased off. This month a net 22% of brokers have reported seeing less refinancing interest from customers.
