The Investor Lending Surge And What to Do About It
Rates are rising. Yet investors aren't stepping back. According to a recent report in The Guardian, investor borrowing in Australia is rising at its fastest pace in a decade, and this is happening right through a period of back-to-back rate rises. That tells you something important about where serious property investors are placing their confidence.
More than 57,000 investors borrowed nearly $40 billion to buy homes over just three months, a 17.6% jump in the combined value of loans from the previous quarter, and a 13.6% rise in the number of new investment loans approved. Meanwhile, owner-occupier loan numbers grew just 2% over the same period. The gap between those two numbers is not a coincidence.
So what's driving this?
The Reserve Bank noted in November that investor credit was growing at its fastest pace since 2015, and that pickup had actually started before the RBA began cutting rates in 2025. Then, when the RBA pivoted and cut three times through 2025, investors moved fast. The number of new investor loans rose 64% from the early-2023 low, pushing investors' share of total housing finance close to the highest levels since 2017.
Even now, with the cash rate sitting at 4.35% after three consecutive hikes in 2026, investors aren't pulling back. Strong rental growth and very low vacancy rates across the capitals are keeping the numbers in their favour. Around 93% of investor sales in the closing months of 2025 delivered a profit, the strongest result in at least a decade, with nearly every investor sale in Brisbane, Adelaide, and Perth achieving a price above its original purchase cost. That's the market telling you that long-term property growth is still very much on the table.
But this is where the loan structure becomes everything.
Here's the truth that a lot of investors miss: the rate itself isn't the whole story. How you structure your investment loan, the product type, the repayment strategy, and the way rental income is assessed, make a bigger difference to your cash flow than a 0.25% rate move.
At KM Financial Services, we help investors across Australia, from first-timers to those building multi-property portfolios, structure investment loans that actually fit their goals. That means looking at your borrowing capacity, checking whether your current loan still makes sense, and identifying whether refinancing could free up equity for your next move.
Use our borrowing capacity calculator to get a quick read on where you stand. And if you've been sitting on the same loan for a few years, it's worth running a loan health check. Rates and lender policies have shifted significantly, and there may be a better option sitting right in front of you.
Westpac's chief economist is forecasting around 5% national price growth through 2026, more moderate than 2025, but still growth. Investors who structure their finances well now are the ones best placed to take advantage of that.
Ready to make your move?
For tailored advice or to discuss your investment loan strategy, reach out to KM Financial Services. Call us on 0402 879 531 or book a free consultation. We'll sit down with you and work through a finance plan that's built around your goals, not just today's rates.
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