Australia’s property landscape is seeing a notable shift: many long-term investors are choosing to sell their properties. A recent poll found that a record number of 16.7% property investors sold at least one property in 2025. This is an increase from 14.1% in the previous year. These veteran landlords point to increasing land taxes, rising compliance costs and policy uncertainty as the major drivers for their departure – in short, they say they are now more at risk than rewarded. The starts and stops with this may seem concerning early on, but this stream of investor sell-offs is actually generating fresh opportunities for new buyers and investors who could recoup a potential market stumble.
A Resilient Market Underpins Buyer Confidence
The good news for prospective buyers is that Australia’s housing market remains fundamentally resilient and stable. Despite the interest rate hikes of the past few years, overall mortgage health is strong. The Reserve Bank of Australia’s latest Financial Stability Review highlights that loan arrears (home loans over 90 days behind on payments) have settled back around pre-pandemic levels.
Importantly, housing values are rising again – national prices have climbed about 10% since the RBA began lifting rates in May 2022, which has boosted homeowners’ equity and reduced the share of borrowers in negative equity. In fact, less than 1% of households are currently in negative equity, a much lower share than before the pandemic. In short, the housing market’s foundation is solid. For new investors, this lowers the risk of entering the market now, since you’re stepping into a broadly stable environment supported by strong borrower finances.
Investor Activity Shifts as Rates Ease
Even as some veteran investors leave, others are jumping in – and history shows investor activity tends to pick up when interest rates fall. In fact, investor mortgage lending has been rising over the past year and now sits above its post–GFC average. Early signs of easing financial conditions (such as the recent pause or cuts in rates) are also sparking a slight uptick in risk appetite – regulators note high debt-to-income lending has started to tick up again as borrowing costs come down.
For a new investor, this trend has a double meaning. On one hand, it confirms confidence in property (since more investors are seeking loans again), but on the other hand, it foreshadows growing competition for the best deals.
What It Means for New Buyers
From a buyer’s agent perspective, these trends create a favourable window for new investors. Here are some key takeaways and tips to consider:
- More options and bargaining power: The surge in investors selling is bringing much-needed stock back to the market. The more sellers there are, the more houses buyers have to choose from, plus more leverage to bargain down prices if they have that much negotiating power.
- Lower risk in the short term: Strong borrower fundamentals are keeping distress sales and default to a minimum. Thanks to controlled arrears and most homeowners concentrated away from negative equity, the short-term risk of a sudden market rout is lower. This may reassure new buyers that they’re coming into a stable market and not a declining one.
- Room to rise further: Low supply and recent price increases indicate this upward trend in home values will continue. Prospects of capital growth continue to be positive, particularly if you buy well in aspirational pockets. So, new investors can still build up equity over time.
Ready to make your move? For tailored advice or to discuss your buying strategy, contact Investmate. You can give us a call at +61 421 942 049 or book a free consultation today to talk freely. Our knowledgeable buyer’s agents will help you navigate these shifting market dynamics and get you in the right home that fits your needs.
