The Australian property landscape for borrowers in 2025 has evolved significantly. As we are heading towards 2026, borrowers and investors are finding themselves in a stronger position than at any time in the past two years. The rate movements of the 2025 cuts and the stability exhibited by the RBA have set the stage for refinancing, investment loans, and smarter borrowing decisions. There’s a unique window of opportunity for homeowners, property investors, SMSF borrowers, and commercial-finance clients to “plan practically” and strengthen their borrowing capacity. At OM Financials, we truly believe smart refinancing strategies now can pay off—not just in lower repayments, but in greater flexibility and growth potential for 2026 and beyond. We are ready to help you navigate the changing market, assess your borrowing capacity, and set up mortgages aligned to long-term growth.
2025: A Year of Rate Adjustments and Market Borrowing Conditions
In 2025, the Reserve Bank of Australia (RBA) lowered its official cash rate in three rounds in February, May, and August, bringing the target down from 4.35% at the end of 2024 to 3.60% by August. Variable home loan rates dropped accordingly, bringing mortgage rates under 6% back into mainstream lending, a significant relief for numerous borrowers.
According to the latest lending data from the Australian Bureau of Statistics (ABS), the number of new loan commitments for dwellings rose 6.4% in the September quarter of 2025, while the value of those new commitments significantly rose 9.6%. Investor loans saw a particularly strong surge: new investor loan commitments rose 13.6%, reaching 57,624 new investor loans, the highest level since early 2022. The total value of those investor loans hit A$39.8 billion—a 17.6% increase from the previous quarter.
This trend reflects growing confidence among buyers and investors, buoyed by more favorable borrowing conditions.
Why 2026 Looks Promising: Timing and Borrowing Capacity
- Improved Borrowing Capacity
Lower interest rates basically reduce the cost of servicing debt. In addition, with repayments becoming more manageable, individuals and investors are likely to qualify for higher loan amounts under standard lending-serviceability assessments. This boosts borrowing capacity in 2026, paving the way for larger acquisitions or portfolio expansion.
- Opportunity to Refinance from High-Cost Loans
In early 2024–25, many borrowers locked in loans when rates were high. Now 2026 will offer a strong opportunity to refinance at improved rates, potentially lowering repayments and increasing cash flow. With competition among lenders still healthy and borrowing costs relatively low, refinancing in 2026 may offer better loan features, optional interest-only periods, access to commercial finance, or better LVR (loan-to-value ratio) terms for investment or SMSF property loans.
- Strong Investor Loan Activity & Confidence
According to recent data from the Australian Bureau of Statistics, investor loan commitments rose sharply. This indicates growing investor confidence and supports the idea that lenders may be more willing to support investment-property financing (e.g., investment loans for developments like “The Ponds new builds” or “Parklea development”). Taking professional advice from OM Financials, investors can take advantage of favorable conditions to expand their portfolios.
Strategic Considerations for 2026: What Borrowers Should Plan Now
When preparing for refinancing or new borrowing in 2026, it’s wise to think several steps ahead. Here are strategic steps to consider:
- Assess total debt-to-income ratio and borrowing capacity: With the rate cuts, many borrowers automatically have a larger loan buffer. Make use of this exceptional plan for investment property loans, even SMSF property loans, without overstretching finances.
- Evaluate different loan types depending on your goals: For a first home or family purchase, standard owner-occupier loans may still make sense. For long-term wealth building, especially via property, consider investment loans tied to new builds or SMSF property loans. For those in business or owning commercial property, explore commercial finance options.
- Factor in new builds and growth corridors: Suburbs such as The Ponds and Stanhope Gardens, or developments like Parklea, NSW, have the potential for long-term capital appreciation. Investing now when borrowing capacity is robust can quite yield significant gains in the long run.
- Think long-term, not just about immediate savings: A lower interest rate environment may tempt borrowers to stretch even further. But remember, property investment is a long-term strategy. Plan practically to make certain that loan repayments & cash flow remain manageable under different interest rate scenarios.
How OM Financials Helps You Plan for 2026
At OM Financials, we specialize in tailored mortgage solutions whether you’re financing a new home, refinancing an existing loan, investing in developments, or securing SMSF property loans. With our profound knowledge of lender policies and market cycles, we’ll guide you to:
- Evaluate the true cost-benefit of refinancing now versus waiting;
- Maximize borrowing capacity for 2026;
- Secure favorable interest rates and loan structures;
- Avoid potential pitfalls of variable rate swings or incomplete rate-cut pass-through;
- Align financing strategies with long-term investment growth and cash-flow objectives.
Final Thoughts: Refinance Smart, Invest Wisely
The rate movements of 2025 haven’t just given borrowers temporary relief—they have set the stage for the upcoming 2026. As a consequence, with a stable cash rate at 3.60% and lenders competing aggressively, 2026 is shaping up to be a strong refinancing and investment year. Borrowers who plan practically now, review loans, seek expert advice, and align financing with long-term goals stand to benefit considerably.
At OM Financials, we specialize mainly in guiding borrowers through complex loan options—from investment loans and SMSF property loans to commercial finance , making certain you plan practically and capitalize on opportunities in the coming year.If you’re ready to make a move, don’t wait. Call now at+61-478-876-967 to book your free consultation call, or follow us on LinkedIn & Instagram for expert property advice, market trends, and real success stories of long-term growth achieved through smart buying strategies.