Confidence Rebounds - Investors Surge Back Into the Property Market

New lending data confirms what many in the industry have started to observe: property investors are making a strong comeback. According to analysis from Money.com.au, investors are re-entering the market at nearly three times the pace of owner-occupiers, marking a clear shift in sentiment and strategy.

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Jacob Overs, General Manager of Lending at Money.com.au, says the rebound signals a renewed sense of confidence among investors. “We’re just shy of the investor loan peak set in 2022,” he notes, referencing the 196,241 new investment loans written in the March 2025 quarter alone.

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The average investment loan size also saw strong growth, rising 7.9% year-on-year to $673,033, suggesting investors are increasingly targeting higher-value assets, likely in response to capital growth expectations and rising rental yields across key markets.

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Investors Driving Refinancing Activity

In addition to new lending, investors are leading the charge in refinancing. The March quarter saw a record 173,948 investor loans refinanced, highlighting a strategic shift by investors to optimise their portfolios amid a volatile interest rate environment. This aligns with recent industry data showing investors are actively shopping for more competitive terms as fixed-rate rollovers peak.

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Victoria Rebounds Despite Headwinds

While recent years have seen a slowdown in Victorian investor activity due to high stamp duties and land tax surcharges, the latest data suggests a potential turning point. Investor loans in Victoria increased in the first quarter of 2025, a notable reversal from previous declines.

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“Despite the deterrents, investors appear to be reassessing Victoria, likely due to its underlying fundamentals: tight rental supply, strong population growth, and resilient capital city markets,” says Overs.

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Broader Market Trends Reinforce Momentum

The investor revival comes amid broader macroeconomic shifts. According to CoreLogic, national home values rose 6.8% over the past year, with investor-favoured markets like Perth, Brisbane, and Adelaide leading the charge. Vacancy rates remain near record lows, and rental yields in some capital cities now exceed 4.5%, making real estate increasingly attractive compared to equities or term deposits.

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In New South Wales, investor activity has reached new heights, with investor loans making up over 41% of all new loans, a sharp rise from 30% just a few years ago. This signals a wider national trend: property is once again a preferred vehicle for wealth-building, especially as inflation stabilises and rate cuts loom on the horizon.

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Key Takeaways:

• Investor loans up 19% year-on-year, outpacing owner-occupiers (6%).

• Average loan size for investors is now $673,033, up 7.9%.

• Record refinancing volumes: 173,948 investor loans in March quarter.

• Investor activity growing again in Victoria despite previous tax headwinds.

• Broader data shows surging rents, tight supply, and renewed capital growth are fueling the trend.

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