Australian mortgage brokers are entering a period of both considerable opportunity and fresh challenges, shaped by changes in tax policy, evolving market dynamics, increased regulatory scrutiny, and shifting client needs. Here’s an informed overview of the current landscape and its direct implications for brokers.
Tax Reform and Policy Changes
Proposed reforms to negative gearing and capital gains tax may reshape investor behaviour from July 2025. The key measure is to restrict negative gearing and the capital gains tax discount to the first investment property only, with any additional investment properties excluded from these benefits. Most property investors will no longer be able to offset losses from multiple properties against other income streams, and capital gains on second and subsequent properties will be taxed without the former 50% discount. The likely result is a more cautious investor segment, which could slow activity among multiple-property buyers but may open the door for more owner-occupiers and first-home buyers to enter the market. Brokers serving investors may need to adapt, but those working with new entrants or upgraders could see more demand.
Market Trends and House Prices
The 2025 housing market continues to reflect a seller’s market, with price growth persisting, though at a slower rate than the boom periods of the early 2020s. High interest rates make affordability a key issue. Affordable regional markets and certain capital city suburbs are outperforming, fuelled by continued internal migration and lifestyle-driven buying. Upsizing is also a notable trend, as established homeowners use equity growth from recent years to purchase larger homes. Mortgage brokers who understand these shifts—particularly the growing demand for housing in regional areas and greater interest in supportive mortgage products—are particularly well-positioned to grow their business by advising clients on access to finance in viable markets and leveraging their accumulated equity.
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Regulatory Focus: Credit Repair Industry
ASIC’s ongoing review of the debt management and credit repair sector is attracting significant attention. Increased regulatory scrutiny targets underperforming or non-compliant operators, focusing on consumer protection and the elimination of excessive fees, misleading practices, and inadequate client service. This is ultimately positive for reputable mortgage brokers, who benefit from a more trustworthy and transparent market to refer clients in need of credit help. With clearer standards, brokers can make more informed recommendations, knowing their clients are less likely to fall victim to unscrupulous credit repair businesses. However, brokers must remain diligent in monitoring the regulatory landscape and be prepared for tighter controls and more structured referral processes for vulnerable clients.
Property Valuations: Broader Implications
Accurate house valuations continue to underpin the mortgage broking process. With lenders maintaining rigorous assessment criteria—especially for high loan-to-value ratio transactions—the ability to explain and advocate through the valuation process remains critical. Brokers play a central role in guiding clients through different types of valuations (desktop, kerbside, full) and helping them understand their implications, particularly when valuations come in below expectations or jeopardise loan approvals. Demonstrated expertise in property valuation can significantly strengthen a broker’s client relationships and ultimately support more successful deal flow.
In Summary
Australian mortgage brokers in 2025 must be agile and well-informed:
- Opportunities include heightened homebuyer activity in affordable and regional areas, strong demand from upgraders, and greater trust enabled by regulatory clean-up of credit repair services.
- Challenges stem from less investor-driven property activity as tax concessions tighten, ongoing price pressures amid a sellers’ market, and the need to navigate complex regulatory compliance around credit-related referrals.
Success in this environment will depend on the ability to anticipate clients’ changing needs, educate and empower borrowers, and maintain the highest professional standards—especially in advocacy, compliance, and communication. Brokers who do so will remain vital partners in the Australian real estate journey.
