First Home Buyer and Investor Lending Both Slump Since the Budget — Why a Thinner Market Can Favour Prepared Borrowers

First home buyer activity has pulled back almost as sharply as the well-documented investor retreat, according to new lending figures reported this week. Both segments have dropped noticeably since the federal budget, reinforcing a picture of a cooling market — one where auction clearance rates across the capitals have now sat below 50% for three straight weeks.

What the numbers say

A simultaneous pullback from both first home buyers and investors is unusual. It suggests the slowdown is being driven by broad sentiment and affordability pressure rather than one policy lever. With headline inflation still at 4.0% and the RBA holding at 4.35%, buyers are hesitating — waiting for clarity on rates and prices before committing.

The counter-intuitive opportunity

A quieter market is not bad news for everyone. When fewer buyers are competing:

• Negotiating power shifts to buyers. Less competition at auctions and private sales means more room to negotiate on price and terms.
• Pre-approved buyers move first. In a hesitant market, the borrower who already has finance sorted can act while others wait — and prepared buyers win the best deals.
• Self-employed buyers are less crowded out. In hot markets, self-employed applicants often lose to buyers with faster, simpler bank approvals. A slower market removes that pressure and rewards those who can document income properly.

Where MPFG fits

The borrowers most likely to hesitate right now are exactly those mainstream banks serve least well — self-employed clients, new migrants and PR holders whose income doesn't fit a standard payslip assessment. MPFG's Alt Doc and Full Doc pathways let these buyers get finance-ready using BAS statements, accountant's letters or business financials, so they can act decisively while competition is thin rather than scrambling when the market turns again.

A cooling market rewards preparation over speculation. The question isn't whether prices have bottomed — it's whether your finance is ready when the right property appears.

This article is general information only and does not constitute financial or credit advice. Lending is subject to eligibility and responsible lending assessment.