Investor confidence on the rise

First-time buyers are more likely than ever to consider an investment property as their first purchase, to build equity and generate income, new research shows.

The latest quarterly Mortgage Choice Home Loan Report has revealed that investment loans are outpacing owner-occupier growth in every region, with Western Australia and Queensland leading the charge.

Mortgage Choice CEO Anthony Waldron said the results suggest that current market conditions are encouraging a new generation of investors to enter the market, predicting the demand for investment properties is likely to remain strong.

“Our survey reveals that investors are the most confident buyers right now”, Waldron said. “This quarter, we found that optimism among prospective investors is 12 percentage points higher than those looking to buy a home.”

The findings also showed a drop in investors looking to sell their investment property in the next 12 months - 23 per cent this quarter compared with 31 per cent last quarter.

“Market conditions are driving a shift in investor behaviour, with our research showing a growing number of investors are planning to hold onto their investment property over the next 12 months”, Waldron said.

“Investors are benefitting from lower mortgage rates, which make it more affordable to service investment loans. At the same time, a limited supply of rental property is driving demand from tenants and pushing up the price of rents.”

Mortgage Choice home loan submission data for the September 2025 quarter reveals that the value of loans to investors was up 34 per cent over the year.

The value of investment loans was highest in Western Australia – up 52.1 per cent year-on-year, followed by Queensland – up 39.3 per cent year-on-year.

The research showed that one in four first-time buyers are turning to investment properties as their way to get their foot on the property ladder, with interest highest among respondents based in Victoria (40 per cent) and New South Wales (27 per cent).

“When you consider that the median dwelling value in Sydney now exceeds $1.2 million, and is nearly $840,000 in Melbourne, buying a home is out of reach for many, but buying an investment property gives them more options to take that first step into the property market”, Waldron suggested.

Among those considering an investment as their first property purchase, the most common reason was to build equity to purchase a home (27 per cent). Other reasons given included was the potential to generate income (22 per cent), to get into the market sooner (17 per cent) and the ability to buy in a more affordable area without changing where they live (17 per cent).