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Throughout the year to June 2025, investor lending grew by 12 per cent while lending to owner-occupiers grew by just 4 per cent.
The study from Money.com.au attributed the three-times larger growth rate of investor lending to falling interest rates and rising rental yields.
For owner-occupiers, the strain of depleted supply is resulting in stunted growth, the report said.
First home buyer activity on the other hand has flatlined, recording no growth in the year to June 2025.
Throughout the year, total loans reached 521,671. Projections estimate this figure to reach 551,261 by the year to December 2025.
Owner-occupiers made up most of the total, reaching a total of 324,972 loans in the year to June 2025.
Investors are narrowing the gap, however, reaching a total of 196,699 over the period.
The Northern Territory reported extreme growth throughout the year in investor loans, growing a shocking 81 per cent.
Other areas, like Queensland and South Australia, trailed at 16 per cent each. ACT was the only area to record a drop in investor loans, falling by 15 per cent.
For owner-occupiers, Tasmania led the charge, with loans growing 13 per cent over the year to June 2025.
Northern Territory trailed at 10 per cent and ACT at 8 per cent. Western Australia recorded no growth throughout the year for owner-occupier loans.
First home buyer activity was all over the place. In the Northern Territory and Tasmania, yearly growth was 18 per cent and 13 per cent, respectively.
Other areas like Western Australia, NSW and ACT recorded drops of 8 per cent, 4 per cent and 1 per cent, respectively.
There were positive trends surrounding refinancing as borrowers take advantage of reduced interest rates.
According to Money.com.au, refinancing is “truly back” as total refinances in the year to June 2025 reached 585,317.
This is just shy of the record figures in the year to September 2023, where there was a total of 593,496.
Borrowers are opting to refinance with their existing lender, with internal refinances growing 31 per cent throughout the year. There was only a 2 per cent increase in external refinances.
This means internal refinance loans are growing 16 times faster than external refinances.
Money.com.au’s property expert Debbie Hays said supply issues are the most pressing concern, especially as more first home buyers look to enter the market due to reduced rates and government incentives.
“The recovery in owner-occupier loans shows confidence is returning, but a return to peak levels will take time, with supply still constrained and borrowing costs remaining elevated,” she said.
“Further interest rate cuts will bring more home buyers back into the market, but without addressing supply, renewed demand risks pushing prices higher and locking some buyers out altogether.ˮ
[Related: Refinance frenzy: 100k borrowers switch lenders in Q2]
