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The Australian investor market continues to grow, with investor loans rising by 22 per cent in 2024, more than three times faster than owner-occupier loans.
Investor loans are the fastest-growing segment of the market, with a 22 per cent growth in 2024, compared to a 6 per cent increase for owner-occupier loans, new Money.com.au data showed.
In 2024, a total of 515,116 new home loans were issued nationwide, representing an 11 per cent increase from 2023, amounting to $331 billion in mortgages.
In comparison, investor loans totalled 192,843 in 2024, representing 34,234 more loans than the previous year, with an average annual loan size of $648,570.
Money.com.au’s property expert, Mansour Soltani, said investor loans have been increasing three times faster than owner-occupied loans, with the market expected to grow further in 2025.
Soltani said the increase in investor loans can be linked to the growth of house prices, which has increased equity for existing home owners to invest in additional properties.
“With vacancy rates across capital cities at record lows, rental demand showing no signs of easing and population growth, we’re likely to see the investor market pull even further ahead in 2025 as market conditions shift in a downward rate cycle,” he said.
Across the country, Queensland cemented its position as an investor hub, becoming Australia’s second-largest investor market with 23.8 per cent of investor loans in 2024.
Soltani said Queensland overtook Victoria by 1.7 per cent in the investor market for the first time.
“This is the first time Queensland has outpaced Victoria in investor loans for any given year on record,” he said.
In 2024, Queensland recorded 45,872 investor loans – 3,305 more loans than Victoria.
While Queensland eclipsed Victoria in the investor market, the state led the nation for owner-occupied, recording a 10 per cent increase for occupier loans in 2024 – the highest in the country.
Soltani said Victoria has become one of the most accessible property markets.
“Property prices have stayed relatively steady in Victoria compared to other states, so it’s one of the best-value markets in the country right now.
“Home buyers have a rare window to buy something at a more affordable price and in a better location than they would in Queensland, for example,” he said.
Among the major states, Western Australia saw the highest growth in investor loans at 35 per cent in 2024, representing 13 per cent of the investor loans nationwide.
Similarly, the Northern Territory emerged as an investor hub, recording a 40 per cent increase in investor loans but only accounting for 1 per cent of the total investor loans across the country.
Following the Reserve Bank of Australia’s announcement of a 0.25-percentage-point cut, Soltani said the property market is expected to pick up further and shaping to be “the year of first home buyers”.
“We’ve had our first rate cut in nearly five years, and more are expected in 2025, which will boost borrowing power.
“On top of that, government incentives are at an all-time high, and potential changes to serviceability rules around student loans could provide even more relief for first home buyers,” Soltani concluded.
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