Property investment slumps in 2023, says ASX

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Despite residential property investment remaining the second most popular asset for Australians in 2023, there has been a downward trend in the number of people investing in housing, according to the latest Australian Securities Exchange (ASX) report.  

According to ASX data from 2020, the total share of Australian investors with a stake in a residential investment property was 39%. But in 2023, after numerous cash rate hikes from the Reserve Bank of Australia (RBA) to preemptively quash inflation, that number has slipped down to 35%. 

Property investment then and now

In 2020, the cash rate hovered around lows of between 0.10% to 0.75% p.a. This meant investment property loan rates were much lower and more attractive than in 2023.

The current cash rate is certainly much higher at 4.10% p.a.

The ASX’s survey of investor goals showed that the portion of Australians who aim to purchase an investment property in the next three years is at a similar level for both current investors and ‘intending’ investors, at 16% and 15% respectively.

But with home loan interest rates being what they are right now, are prospective property investors being a little too optimistic about their goal? Not necessarily.

Compare investment home loan rates to find a lower rate 

While the average variable investment property loan in Mozo’s database for September 2020 was 3.78% p.a. (P&I @ $400,000 – 80% LVR), the story in 2023 is a little different. 

In September 2023 the average variable rate in our database sits at 6.96% p.a.† – at almost 7% p.a. it’s a far cry from the sub-4% figures up for grabs during the pandemic. 

But it’s not all bad news for property investors. 

In the Mozo database currently there are three lenders offering a variable rate investment property loan below 6% p.a., and over 70 investment loan products with rates below the average of 6.96% p.a.

Some of the lowest variable rates in our database come from lenders like Bank Australia, Hume Bank, and Pacific Mortgage Group, whose variable rates sit around 5.89% p.a.‡ (comparison rates may vary*). At 5.89% p.a., a $500,000 investment property over 30 years would result in estimated monthly repayments of around $2,962. 

In contrast, a loan for the same amount, paying an average variable investment loan rate of 6.96% p.a., would result in repayments of $3,313 per month – $351 more out of pocket and nothing to turn your nose up at. 

There are still plenty of rates in the Mozo database on offer that are lower than the average, which is precisely why doing an investment home loan comparison before you settle on just any old lender can pay off. 

Mozo compares over 90 providers to help kickstart your investment journey to finding the best home loan for you. Take a look at some of the featured products below to get started. 

Home loan comparisons on Mozo

Mozo may receive payment if you click the products below. We don’t compare the entire market, but you can search our database of 472 home loans.
Last updated 14 June 2024 Important disclosures and comparison rate warning*
  • Unloan Variable

    • Investment
    • LVR <80%
    Interest rate
    6.29 % p.a.
    Variable
    Comparison rate
    6.20 % p.a.
    Initial monthly repayment
    $3,092
    Go to site

    Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for investors. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.

  • Basic Home Loan

    • Investment
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.34 % p.a.
    Variable
    Comparison rate
    6.36 % p.a.
    Initial monthly repayment
    $3,108
    Go to site

    No annual or application fees. Competitive rate tiers based on your LVR as well as interest only and split repayment options. Fast application and turnaround process. Secure online application.

  • The Better Home Loan Special Offer

    • Investment
    • Principal & Interest
    • LVR <80%
    Interest rate
    6.19 % p.a.
    Variable
    Comparison rate
    6.19 % p.a.
    Initial monthly repayment
    $3,059
    Go to site

    Reap the benefits of a variable rate investor home loan with a bunch of features from Police Credit Union. Make extra repayments at any time without penalty. No monthly, annual or upfront fees. Free online redraw. 100% offset account available (T&Cs apply). Minimum 20% deposit. Qualifying criteria applies. Minimum loan amount is 200K. For new customers only. Mozo Experts Choice Home Lender Credit Union of the Year 2023.

  • Unloan Variable

    • Investment
    • LVR <80%
    Interest rate
    6.29 % p.a.
    Variable
    Comparison rate
    6.20 % p.a.
    Initial monthly repayment
    $3,092
    Go to site

    Built by CommBank, the Unloan is the first home loan with an increasing discount (conditions apply) for investors. No application or banking fees. No monthly account keeping or early exit fees. Apply online in minutes.

  • Basic Home Loan

    • Investment
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.34 % p.a.
    Variable
    Comparison rate
    6.36 % p.a.
    Initial monthly repayment
    $3,108
    Go to site

    No annual or application fees. Competitive rate tiers based on your LVR as well as interest only and split repayment options. Fast application and turnaround process. Secure online application.

  • Offset Home Loan

    • Investment
    • LVR<60%
    • Principal & Interest
    Interest rate
    6.34 % p.a.
    Variable
    Comparison rate
    6.59 % p.a.
    Initial monthly repayment
    $3,108
    Go to site

    Up to 10 offsets. Competitive rate tiers and interest only repayment option. No application fee. Split loan option. Fast, secure online application. $248 annual fee.

  • Basic Home Loan

    • Fixed
    • Investment
    • Principal & Interest
    • LVR <70%
    Interest rate
    6.55 % p.a.
    Fixed 3 years
    Comparison rate
    6.42 % p.a.
    Initial monthly repayment
    $3,177
    Go to site

    Lock in repayments from 1 to 5 years. Competitive rate tiers depending on your LVR. No application or annual fee. Fast, secure online application.

  • SMSF Home Loan

    • LVR <70%
    Interest rate
    6.99 % p.a.
    Variable
    Comparison rate
    7.00 % p.a.
    Initial monthly repayment
    $3,323
    Go to site

    Enjoy a competitive rate on your SMSF home loan with Loans.com.au. Available for refinancers only. No application fee and no settlement fee. No monthly, annual or ongoing fees. Unlimited extra repayments. Online access via Smart Money App. 30% deposit required.

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Need help with refinancing?

You might have questions that need personal answers. We’ve teamed up with the mortgage brokers at Lendi to get you the answers you need, and a home loan deal you deserve.

Learn more

† Based on a variable rate investor home loan on the Mozo database, on a loan of $400,000, paying principal & interest, LVR <80%, as at 5 September 2023. 

‡ Based on a variable rate investor home loan on the Mozo database, paying principal & interest on a $500,000 investor home loan, LVR <80% over a 30 year loan term, as at 5 September 2023.