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The latest AFG Index report released by Australian Finance Group (AFG) has shown a fall in market share held by the big four banks (for total lodgements) during the March quarter 2025, down from 61 per cent to 59.9 per cent, while non-major lenders increased market share to 40.1 per cent.
The index revealed more first home buyers turning to non-major lenders, increasing to 30.7 per cent during the quarter from 29.4 per cent, while the market share from this cohort held by the major banks fell to 69.3 per cent from 70.6 per cent.
Meanwhile, investment volumes increased slightly for the major banks, up by 0.4 per cent to 57.9 per cent during the quarter. Non-major banks held 42.1 per cent of market share for this category.
AFG CEO David Bailey said: “The country’s Big 4 Banks and their associated brands’ market share slipped below 60 per cent once again as all other lenders made up ground to take 40.1 per cent of flows.”
According to the index, this was further reflected in AFG Home Loans lodgement volumes, which rose by 5 per cent on 3Q24.
“AFG Securities’ lodgements are up 20 per cent on the same period last year and represented 56 per cent of all AFG Home Loans lodgements,” Bailey said.
Lodgement values performing well during quieter period
Furthermore, the index revealed AFG’s highest third-quarter lodgement volume results on record, underscoring the growing preference among borrowers for mortgage brokers.
During the quarter, total lodgements amounted to $24,082,889,294, up from $20,318,157,274 during the same quarter last year.
Bailey said this quarter was a highlight in what is a traditionally quieter period for the sector.
“Australian mortgage brokers are the channel of choice for home finance, with now more than three-quarters of all borrowers choosing brokers to help them navigate a continually complex lending market,” he said.
“AFG brokers are at the forefront of that activity, lodging more than $24 billion in mortgage volume for Q3 2025.
“This is 18.5 per cent higher than the same period last year and 10.2 per cent up on the previous Q3 record, back in 2022.”
Activity was strong in Western Australia with its second-largest quarter ever recorded, showing an increase of 31.5 per cent when compared to the same quarter in 2024, reaching $3.1 billion (just below the previous quarter’s record-high reading of $3.2 billion).
NSW saw a 19.7 per cent increase ($7.7 billion from $6.4 billion), Queensland 18.6 per cent ($4.5 billion from $4.3 billion), South Australia 18 per cent ($1.5 billion from $1.3 billion), and Victoria is rebounding with a 12.4 per cent rise in lodgement volume from the same quarter in 2024, reaching $7.05 billion from $6.2 billion.
[RELATED: Record residential lodgement volumes reflect strong market confidence]
