Banks open the doors some more
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 59 responses.
The main themes to come through from the statistical and anecdotal responses include the following.
Banks have reignited competition between themselves with strengthened cashback offers.
Interest in borrowing by investors is low but not absent.
Borrowers continue to strongly favour fixing two years over all other terms.
Compared with a month ago, are you seeing more or fewer first home buyers looking for mortgage advice?
Early in February this year when we conducted our first mortgage advisor survey for 2026 a strong net 33% of brokers said that they were seeing more first home buyers in the home purchasing market. That proportion fell away to a net 54% seeing fewer young people just two months later as concerns surged regarding the impact of the US attacks in the Middle East.
Last month this pessimism eased to a net 16% of brokers seeing fewer first home buyers and this month the result is essentially the same at a net 14%.
Comments from advisors indicate that many young buyers are keeping a close eye on where mortgage rates are headed and overall economic conditions associated with events offshore. Caution still prevails.
Comments on bank lending to first home buyers submitted by advisors include the following.
More open to high LVR preapprovals, lower UMI (uncommitted monthly income) thresholds.
Lowering the cash surplus required when clients have less than a 20% deposit.
Cash incentives improved for 80-85% as well as interest rate options in the same space. Some changes in general to how expenses and “other” incomes assessed including maternity leave, All improvements to criteria; no negative impacts to borrowers.
Compared with a month ago, are you seeing more or fewer investors looking for mortgage advice?
Whereas in our first survey for the year brokers firmly noted the presence of first home buyers this was not the case with regard to investors. Early in February a net 6% of brokers said fewer investors were in evidence.
That fell to a net 49% seeing fewer come early-April, remained at that reading in early-May, and now is improved but still firmly negative at 29%.
Brokers note that investor interest is there, but it is not as prevalent as before. Investors are more particular about what they will buy and there has been a rise in numbers looking to undertake works to boost yield on an existing property in preference to purchasing a new one.
Comments made by advisors regarding bank lending to investors include the following.
Really drilling down into all expenses.
Tighter on DTI.
Lending up to 80% LVR for applications with a very healthy surplus with one lender.
Not doing a lot of these deals but banks open to applications.
There seems to be an openness to lend to investors, just not the investors willing to commit at this point.
Compared with a month ago, are you finding lenders more or less willing to advance funds?
Our survey this month has recorded a strong rise in the net proportion of mortgage brokers reporting that investors are willing to lend funds. The reading sits at 29% compared with near 0% results for the previous two months.
The result is interesting in that it likely reflects an awareness by banks that lending targets may be hard to achieve over the coming year because of the shock from the US attacks in the Middle East.
What time period are most people looking at fixing their interest rate?
Over 70% of brokers note that borrowers prefer fixing two years and very few are observing interest in any other terms.
The preference to fix just one year fell sharply in December as mortgage rates began rising and has remained low ever since.
The shift away from showing a preference for one year fixing was initially towards a mix of two and three years. Now, only 6% of brokers note borrowers want to fix three years while 74% say the two year term is most favoured.
Are more property owners asking about refinancing?
There has been a recovery this month in the net proportion of brokers noting that more refinancing enquiries are appearing to 12% from -7% last month. The return of high cashback offers may explain this change in interest more than a lift in thoughts of selling one’s property.
