Mortgage Demand Just Had Its Toughest Run Since COVID, Here’s What It Means For You
If you’ve been putting off a chat with your broker, this is your sign. New lending data shows mortgage demand Australia has fallen 12.5 per cent year-on-year to June, the sharpest slowdown since the pandemic. Whether you’re chasing your first home, sitting on an investment portfolio, or just trying to keep repayments comfortable, the numbers are worth understanding.
What’s Actually Happening
First home buyers have taken the biggest hit. Three Reserve Bank cash rate rises this year, on top of a higher cost of living, have chipped away at how much people can borrow. As a rule of thumb, Even a small rate rise can reduce borrowing capacity meaningfully, especially when it happens several times in a row.
Investors with multiple properties have pulled back sharply too, with recent tax and policy changes around negative gearing making some buyers rethink their next move.
It’s showing up in the loan sizes people are actually requesting. The average loan amount fell around $8,000 between March and June, and buyers in Sydney, Melbourne and Brisbane have seen even bigger drops as budgets get squeezed harder in the pricier markets. On the sharper end, mortgage demand Australia hardship payments rose 5.3 per cent over the June quarter, a reminder that some households are already feeling the pinch on loans they took out before rates climbed.
What This Means If You’re a First Home Buyer
A smaller borrowing capacity doesn’t mean the goal is out of reach; it means the plan needs adjusting. Getting pre-approved before you start inspecting properties gives you a realistic number to shop with, so you’re not falling in love with something you can’t actually afford. It also means you can move quickly when the right place comes up.
What This Means If You’re an Investor or Already Have a Loan
If you’re planning your next purchase, it’s worth reviewing your finance strategy before you commit, since lender policies and serviceability rules are shifting faster than usual right now. And if you already have a mortgage demand Australia, this is a good time to check whether refinancing could ease the pressure, rather than waiting until repayments start to feel uncomfortable.
The Smart Move Right Now
Property prices will keep making headlines, but the number that actually matters is your borrowing capacity. Comparing lenders, building a repayment buffer for future rate moves, and making decisions based on what you can genuinely afford, not just what a property is listed for, is what keeps you in control.
Want to make sense of what this means for you?
At OM Financials, we make the loan process simple and guide you every step of the way. Speak with our brokers today to understand your borrowing power and the options available to you. Book your free consultation or contact us anytime on 0478 876 967.
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Frequently Asked Questions
Does lower mortgage demand Australia mean property prices will fall?
Not necessarily. Property prices also depend on housing supply, local demand, property type and economic conditions.
How can first home buyers prepare?
Review your deposit, income, expenses and borrowing capacity. Pre-approval may help you set a more realistic budget.
Should investors delay buying when lending falls?
There is no universal answer. Assess the individual property’s cash flow, financing costs and suitability for your investment goals.
Can refinancing help if repayments are difficult to manage?
It may be worth comparing options, but refinancing approval depends on lender criteria and mortgage demand Australia your financial circumstances. Contact your current lender early if you are struggling with repayments.
Where can I check current Australian lending data?
The Australian Bureau of Statistics publishes official lending indicators, including the reporting period and changes in new loan commitments.