Investors Take Larger Share of Lending

More investors are stepping back into the market, and the latest data shows it’s not just a small uptick, it’s a meaningful shift.

According to the Australian Bureau of Statistics, the value of investor loan commitments jumped 17.6% in the September 2025 quarter, and sat 18.7% higher than a year earlier.

Investors now make up 40.6% of the value of all new loan commitments, the highest share recorded since 2016. This signals growing confidence among investors, even while affordability pressures continue to shape the market.

What’s driving investors back?

Two key forces are doing most of the work: price growth and rental demand.

• National dwelling prices rose 8.6% over 2025
• Rents increased 5.2% over the same period, supporting stronger rental income

Rental yields softened slightly, easing from 3.7% at the end of 2024 to 3.6% at the end of 2025. This wasn’t due to weakening rents, it happened because property values rose faster than rental prices. Even so, yields remain comfortably above the pandemic low of 3.2% recorded in 2021.

Looking beyond headline returns

For investors, yield is only one piece of the puzzle. Borrowing capacity, cash-flow buffers and loan structure all play a role in determining how sustainable an investment really is – not just how profitable it appears on paper.

If you’re considering investing, it can be valuable to sense-check the numbers and see how an investment loan would sit alongside your existing commitments.

Run the numbers on an investment loan