First Home Buyers Gain a Stronger Foothold in the Home Loans Market
Recent reports indicate a progressive trend in the housing finance sector as first home buyers are finding a bigger foothold in the market for home loans. This growth is reflected in the new lending flows for owner-occupier first home buyer loan commitments that took a significant leap in the September quarter of 2025.
Growth in Loan Commitments for First Home Buyers
New loan commitments for dwellings for first home buyers exhibited a promising rise of 2.3% in the aforementioned quarter, while the value of these commitments rose by 1.1%. This increase in loan commitments for dwellings signifies an enhanced confidence among first home buyers and a shift towards housing affordability.
Surge in New Loan Commitments for Dwellings
Notably, the total number of new loan commitments for dwellings rose by an impressive 6.4% in the September quarter of 2025, and the value of these commitments saw a substantial growth of 9.6%. This overall surge indicates a robust growth in the housing sector, driven by both new buyers and investors.
Owner Occupier and Investor Loan Commitments
Further, the number of new owner-occupier loan commitments for dwellings rose by 2.0% in the quarter, with the value increasing by 4.7%. On the investor front, the number of new investor loan commitments for dwellings surged by 13.6% in the quarter, with the value rising by a remarkable 17.6%.
Westpac’s economics team shared their observations on this trend. “Both borrower types saw similar growth drivers, with NSW and Victoria leading the gains and purchases of new dwellings emerging as the primary purpose,” they noted.
Future Outlook for Lending
Economist Neha Sharma suggests that several factors are poised to support the lending outlook further. “While the impact of this year’s RBA rate cuts will gradually fade, the current housing supply-demand imbalance alongside a recent retightening in rental markets should lend a hand to lending activity,” she said.
Sharma also noted that the government’s expanded 5% deposit scheme, which commenced on 1 October, is expected to boost first home buyer activity. She added that the recent tightening in rental vacancy rates could maintain prominent investor activity. “Finally, the supply-demand imbalance in the housing market should continue to put a floor under price and lending growth,” Sharma stated.
As housing prices strengthened in October, the daily data for November hints at a further pick-up, indicating a positive outlook for the Australian banking industry, which is currently experiencing one of the biggest booms in its history.
For more detailed analysis and data, visit the source Here.
