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Banks are competing fiercely for new customers, easing credit rules, and improving rates, while SMSF loans surge and first home buyer activity intensifies, driving ripple effects across major city property markets as Australians rush to secure homes before prices rise further.
However, the reinvigorated lending environment is providing new opportunities for borrowers.
On a recent episode of Broker Daily Uncut, Finni Mortgages principal Eva Loisance said lenders were “hungry” for business, particularly among owner-occupiers and self-employed borrowers.
“Banks [are] competing to get those unoccupied debts, especially the big ones. We’ve seen really good pricing happening in that space and also fixed terms at 4.7 per cent,” she said.
“They’re hungry for business that have been maybe difficult in the past, especially with the self-employed where they struggle to get finance if their tax return was not done or they didn’t have two years’ worth of good history.”
Loisance said the RBA’s next move was uncertain, with clients questioning whether rate cuts were now off the table.
“The thing that comes a lot with clients is a lot of them are talking about, is the RBA actually gonna think twice about reducing rates again now that we have this first home buyer scheme that’s going to put property prices up?” she said.
The expert also observed that SMSF lending, once a niche option for older investors, is rapidly becoming mainstream, offering new streams for brokers.
“Even like five, six years ago, it was very rigid. It was 70 per cent LVR. You needed a lot of liquidity. You know, you had to buy a property that fits the postcode restrictions. Now we see almost any type of lending happening,” she observed.
“For example, Pepper just launched a 90 per cent no LMI product last week or the week before which seems incredible for SMSF... so it’s becoming very easy for people to start SMSF lending.”
Loisance added that SMSF loans were also appealing to brokers because they provided stability.
“What stops people moving the SMSF loan a lot is that you cannot access equity in the property you have in SMSF. So having those loans in your book are definitely a lot more secure,” she said.
Meanwhile, first home buyer schemes are driving up demand and record-setting auctions across Sydney and Melbourne.
“We see new records everywhere – people trying to get in as quick as they can… in six months’ time they would be paying a lot more on the same property,” Loisance said.
Podcast co-host Alex Whitlock said the surge in entry-level activity was now flowing through the rest of the market.
“If the bottom end starts to shift, there’s a period of time before it’s the middle and then it’s the top,” he said.