New lending data shows that First Home Buyer (FHB) activity has stagnated, with only a 0.2% increase in new FHB loans over the past year. The Money.com.au First Home Buyer Mortgage Insights Report recorded 123,363 loans in the 12 months to June 2025 — a figure that remains 31.7% below the September 2021 peak, when ultra-low interest rates boosted affordability.

The average FHB loan is now $546,315, roughly $154,000 less than the average non-FHB loan, reflecting the affordability gap faced by first-time purchasers.

According to Money.com.au property expert Debbie Hays, Queensland and Victoria are the only major states to experience growth in FHB lending — up 5% and 4% respectively — while Western Australia (-8%), New South Wales (-4%), and South Australia (-1%) all reported declines.

Hays says Victoria’s smaller average loan size has made it the most accessible market for new buyers. She expects lending activity to improve in late 2025 as the First Home Guarantee Scheme expansion gains traction. “The scheme’s extension is likely to stimulate short-t