The ABS’s June quarter 2026 Lending Indicators release landed with a clear signal: property investors have pulled back, and they’ve pulled back harder than any quarter since late 2022.
The numbers
- New investor loan commitments fell 8.6% in the June quarter — the largest quarterly fall since September quarter 2022 — while the value of investor lending dropped 10.2% to $37.1 billion.
- The pullback wasn’t even across the country. NSW fell 15.5%, Victoria fell 14.2%, and Queensland fell 10.1% — the three markets that led the retreat.
- Meanwhile, the Northern Territory (+12.8%), the ACT (+8.7%) and Tasmania (+5.3%) all recorded rises, a reminder that this isn’t a uniform national story.
- Owner-occupier lending fell too, but by a smaller 3.3% — investors clearly absorbed more of the shock this quarter.
Two things worth being precise about with clients
It’s not one cause. The ABS pointed to two things happening in the same quarter: the RBA’s third cash rate increase of 2026, and the May Federal Budget’s negative gearing and CGT announcements. Both were weighing on investor decisions at the same time — attributing the whole move to the tax reform alone overstates the case, and a rate-driven pullback is a different conversation to a tax-driven one.
It’s a sharp slowdown, not a collapse. Investor lending is still running 2.8% higher than this time last year — down from 19.4% annual growth as recently as the March quarter, but still growth. The story is deceleration, not an exodus.
What this means for the clients still in the market
A national pullback of this size usually means the investors still transacting are doing so more deliberately — and early indications support that. Rather than stepping back altogether, some are recalibrating toward properties with stronger rental yields or lower entry prices, instead of the higher-growth, higher-leverage plays that dominated the market through 2025.
That’s exactly the environment where cash flow becomes the deciding factor in whether a deal stacks up — and where the loan structure sitting underneath a client’s decision matters as much as the asset itself.
Where this connects back to the loan conversation
If a client is one of the ones still active — adding to a portfolio, or restructuring an existing one to hold through this slower period — they’re doing it with less tax-side support than before and, this quarter, a higher cost of capital too. A structure like AMP’s Equity Flex Loan (up to 10 years interest-only, no reassessment during that period) is designed for exactly that kind of cash-flow-first decision. We covered the product in detail in our last post (https://ozbroker.com.au/the-new-cgt-and-negative-gearing-rules-just-changed-the-cash-flow-conversation-with-your-investor-clients/)
We’re seeing the lending side of these recalibrations in real time. If you’ve got clients rethinking their position in this market, we’d welcome the chance to work through the structuring options together
Contact us to set up a referral relationship.
Important information
Lending data sourced from the Australian Bureau of Statistics, Lending Indicators, June Quarter 2026 release. This article is general information only, current as at the date of publication, and does not take into account any individual’s objectives, financial situation or needs. It is not financial, tax or legal advice. Readers should seek their own professional advice, and refer clients to a licensed financial adviser or accountant, before acting on anything discussed here.