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Investor lending surges as housing market heats up

New housing lending jumped in the September quarter, prompting fresh scrutiny from the Reserve Bank of Australia.

12 November 2025

Homes in Springfield, west of Brisbane. Picture: AAP Image/Darren England

Key takeaways:

  • Total new housing lending rose 9.6% in Q3 2025, more than double the expected pace.
  • Investor lending grew 17.6% in the quarter and 18.7% over the year.
  • NSW accounted for nearly half of the national increase in new lending.

Housing loans surge past forecasts

Australia’s housing market is heating up, with new lending rising much faster than expected in the September quarter, according to the Australian Bureau of Statistics (ABS). The 9.6 per cent jump was well above the 2.6 per cent forecast and was driven mostly by investors, who are returning to the market in force.

“This is a clear sign that financial conditions may not be as tight as we thought and shows that interest rate cuts are working their way through the economy,” said Ashwin Clarke, Senior Economist at CBA. “Investor lending is strong, but still below the highs we saw in the mid-2010s.”

Types of housing lending

Owner-occupiers still active, but investors dominate

Loans to owner-occupiers also rose, but at a slower pace - up 4.7 per cent for the quarter and 9.8 per cent over the year. The average loan size increased, reflecting rising property prices, especially in the eastern states. NSW led the growth, followed by Victoria and Queensland.

Value of housing lending - September quarter

Investors eye cheaper properties

In NSW and Victoria, investor loan sizes grew more slowly than those of owner-occupiers, suggesting investors may be targeting more affordable homes. This could be linked to the federal government’s new 5 per cent deposit scheme for first-home buyers, which started on 1 October.

While the full impact of the scheme is likely to show up in 2026, some investors may be getting in early — anticipating further price rises.

To read Ashwin Clarke’s full analysis see here.

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The information presented is an extract of a Global Economic and Markets Research (GEMR) Economic Insights report. GEMR is a business unit of the Commonwealth Bank of Australia ABN 48 123 123 124 AFSL 234945.



This extract provides only a summary of the named report. Please use the link provided to access the full report, and view all relevant disclosures, analyst certifications and the independence statement.



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