Key takeaways
Buyer and seller confidence has jumped sharply since the RBA’s interest rate cut.
The Westpac-Melbourne Institute Consumer Sentiment Index is at its highest since March 2022.
Investment loans jumped 3.5% (49,065 loans worth $32.9B) after two softer quarters.
Average investor loan size now $674,259, almost equal to owner-occupiers.
Household incomes are not rising fast enough to match property costs, keeping affordability tight.
Sydney and Melbourne continue to lead auction results, with near boom-time clearance rates.
National clearance rate: 66.9%, slightly down from 73.5% last week but much higher than 61.7% a year ago.
This week the big story in property is confidence – both property buyers’ and sellers confidence has jumped sharply following the latest interest rate cut.
It is palpable on the ground; our buyer’s agents at Metropole are seeing it, and it was evident at auctions over the weekend again.
The Westpac-Melbourne Institute Consumer Sentiment Index is now at its highest point since March 2022.
And when it comes to property, the positive sentiment is even more obvious.
Their “Time to Buy a Dwelling” index jumped to 97.8 points – a four-year high, over 10% higher for the month and 37% higher for the year. Buyers are clearly seeing opportunity, with confidence lifted by lower mortgage rates.
Meanwhile, the “House Price Expectations” index is trending strongly. At 164.2 points, it’s at its second-highest level since 2013.
This renewed optimism is already reflected in increased buyer demand, higher loan approvals, and stronger auction clearance rates.
Lending trends- June Quarter 2025: what it means for investors
Australia’s housing finance data for the June quarter paints a picture of a market that’s gathering momentum, with both owner-occupiers and investors showing renewed confidence.
In this week's Property Insider video, Dr. Andrew Wilson explains that these figures are backward-looking, and lending trends would have increased even more with falling interest rates.
Owner-occupier activity is steady but rising in value
While the number of new loans (80,929) only crept up 0.9% over the quarter, the total value rose by 2.4% to $54.7 billion.
That tells us people are borrowing more per purchase – consistent with rising property values, particularly in markets like Queensland, South Australia, and Western Australia where prices have been running hot.
The average loan size is now $678,011, up 7.5% in a year.
Importantly, refinancing activity is still elevated, suggesting many households are still working to manage cash flow and lock in better deals even as rates come down.
Investor lending is bouncing back
After two soft quarters, the number of new investment loans jumped 3.5% to 49,065, worth $32.9 billion.
While annual growth has slowed from last year’s surge, the level of activity remains historically strong – a sign that investors are active in the market.
In fact, the average investor loan size is now $674,259, almost identical to owner-occupier borrowing, which reflects the rising competition for quality assets.
Notably, the biggest growth came from the Northern Territory and Western Australia.
First-home buyers are creeping back in.
- Also read:Latest Property Price Forecasts Revealed. Australian Property Market Outlook 2025–26: Where Prices Are Headed After Three Rate Cuts.
- Also read:Why Aussies Are Suddenly More Positive About Property. Time to Buy? | Property Insiders
- Also read:This week’s Australian Property Market Update – Latest Data, State by State August 26th 2025
- Also read:National Auction Report – August 23rd 2025 | Strong Sydney and Melbourne Markets Continue to Lead Late Winter Auction Results
- Also read:Perth housing market update | August 2025
Their numbers rose 1.7% to 28,861 loans, with Queensland, NSW, and Tasmania leading the charge.
While still modest compared to investors and upgraders, this is a sign that lower interest rates and easing conditions are giving new buyers the confidence to re-enter.
The bigger picture for investors? These figures show that confidence is steadily returning to the housing market, and that’s being reflected not just in sentiment surveys but in real borrowing behaviour.
Owner-occupiers are stretching to meet higher prices, first-home buyers are making a cautious comeback, and investors are re-engaging after a brief pause.
With borrowing costs easing, competition for well-located properties is only going to increase from here.
For seasoned investors, this reinforces the importance of positioning yourself ahead of the broader crowd. Those who secure quality assets now are likely to benefit from renewed demand, rising prices, and tightening rental markets in the years ahead.
Wages rise 3.4% in the year to June 2025
Wages are still growing, but at a slower pace than last year – and that has important implications for the housing market.
Watch this week’s Property Insider video as Dr. Andrew Wilson explains that the ABS Wage Price Index rose 0.8% in the June quarter and 3.4% annually, unchanged from the March quarter but down from 4.1% a year earlier.
The slowdown reflects fewer workers receiving larger pay rises, with most wage increases now more modest.
Private sector wages lifted 0.8% for the quarter and 3.4% over the year, while public sector wages rose 1% in the quarter and 3.7% annually, boosted by backdated enterprise agreements.
For property investors, the key takeaway is that household income growth is not keeping pace with housing costs.
That means affordability pressures remain – but it also reinforces the likelihood that the Reserve Bank will keep cutting rates to stimulate spending and housing demand. In other words, it’s lower borrowing costs, not stronger wages, that are driving the renewed confidence we’re seeing in the property market.
This environment favours investors who act early. With wages unlikely to fuel demand directly, interest rate movements will continue to be the dominant factor shaping both buyer sentiment and property price growth over the coming year.
Further, average weekly ordinary time earnings for full-time adults were $2,010.00 in May 2025, according to new seasonally adjusted figures released by the Australian Bureau of Statistics, surpassing $2,000 for the first time.
Strong Sydney and Melbourne Markets continue to lead late Winter auction results
Sydney and Melbourne continue to produce strong late winter auction results at near boomtime levels - more top capital city performances.
The national weekend auction market reported an average clearance rate of 66.9% over the past week, which was lower than the 73.5% reported over the previous week but again well ahead of the 61.7% reported over the same week last year.
Seller numbers are now significantly on the rise as the spring selling season approaches but clearance rates remain generally in favour of sellers in most capitals.
