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New data showed national loan approvals are up 15 per cent year on year for the March quarter, with strong momentum coming from NSW, Queensland, South Australia, and Western Australia.
The report was compiled from aggregator Loan Market Group’s national broker network of 6,000 brokers.
In contrast to the growth of the aforementioned states, Victoria only showed marginal growth, rising just 3 per cent in the same period.
Additionally, investor lending appears to be the key driver in some states, with increases of 32 per cent in NSW and 50 per cent in South Australia.
Queensland, meanwhile, has seen strong growth among owner-occupiers across various regions – including the Sunshine Coast, Far North Queensland, and Brisbane – each recording 25 per cent increases since the third quarter of 2022.
Melbourne, however, tells a different story. Investor lending in the city’s western suburbs is down 43 per cent, with total loan approvals in Victoria declining 8 per cent since 3Q22.
Investor sentiment appears to be strengthening in key non-capital regions, according to Loan Market Group’s CEO David McQueen.
“Investor confidence is growing beyond the capital cities, especially in areas like Perth, coastal Sydney, and regional Queensland. That kind of activity doesn’t happen unless buyers see long-term upside and rising rental demand,” McQueen said.
“The next phase of loan growth is likely to come from owner-occupiers re-entering the market as rates fall and confidence improves.
“Our brokers are telling us they’re working with more clients who are chasing lifestyle and affordability and they’re not afraid to move for it.”
Sam White, Loan Market Group’s executive chairman, said the data showed a continuation of Aussies’ “love affair with property”, albeit with uneven momentum.
“Approvals are up 24 percent in NSW and South Australia, and 21 percent in Queensland, while Victoria is barely moving at 3 percent growth,” White said.
“It continues to be a challenging time for home buyers in parts of Sydney and Melbourne, where borrowing capacity has been heavily impacted by the rate hiking cycle.
“We’re seeing strong growth in areas where housing is more affordable, and where buyers are getting more value for their loan.”
Jon Mott, banking analyst at Barrenjoey, said the figures reflected the broader market dynamics following the initial interest rate cuts.
“The first of the interest rate cuts did not stimulate demand, with the data showing approvals fell 4.5 per cent in March,” he said.
“We expect the RBA will continue a cutting cycle, which will lead to improved borrowing capacity to support a broad-based lift in housing credit.”
The report further revealed that median approved loan sizes are rising sharply in several states, increasing from around $450,000 to over $600,000 in Queensland, $430,000 to $580,000 in Western Australia, and $410,000 to $560,000 in South Australia since late 2022.
Victoria’s median loan size, however, has remained relatively flat, holding just above $500,000.
“Buyers are redrawing their maps, moving beyond the city fringe into regions that were once considered ‘too far’. It’s a direct response to affordability pressure, but also a mindset shift around what home and investment look like,” McQueen said.
“The national story doesn’t hold up at a postcode level. What’s booming in one region is flat in the next and that’s where brokers are playing a critical role.
“In a fragmented market like this, brokers are critical. They’re the ones helping borrowers understand the trade-offs, navigate tighter lending conditions and get a fairer deal on finance.”
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