Rebounding House Prices Drive Activity

Australian house prices are posting robust gains across capitals and select regional markets in 2025. Sydney’s median house price has reached a record $1.72 million, rising 2.6% in the June quarter alone. The upper end of the market, showcased by Bellevue Hill’s approach to the $10 million median, signals buoyant demand, especially in prestige segments. This resurgence provides brokers with a wide pool of motivated buyers and refinancing clients, both for upgraders and for those tapping equity as values rise.

Renewed Demand for Expertise

Amid the price surge, first-home buyers and investors face complex choices around timing, affordability, and lending criteria. The regulatory landscape remains tight, placing responsible lending obligations front and centre. This environment heightens the value of professional guidance. Clients increasingly seek tailored support navigating shifting borrowing limits, product options, and evolving lender processes, reinforcing the central role brokers play in helping Australians secure and structure home loans.

Policy Endorsement and Competition

Recent policy moves by the federal government underscore the importance of the broker channel in keeping the market competitive. By maintaining current commission structures and recognising brokers’ contributions, policymakers help ensure brokers remain viable and attractive for new entrants and clients alike. High broker market share—approaching 60% of all new home loans—illustrates this systemic value.

Tightening Lending Conditions and DTI Focus

Discussions around debt-to-income (DTI) limits, particularly borrowing ratios beyond six times income, pose potential restrictions. In practice, average property prices often force borrowers above this threshold, especially in major cities. Should lenders restrict high DTI loans more aggressively, brokers will need to manage client expectations and possibly face reduced borrowing power among broad customer segments, risking fewer loan approvals and lower commissions.

Operational and Compliance Pressures

With new prudential standards (like CPS 230) rolling out, brokers continue to face comprehensive compliance requirements. This includes extensive client documentation and ongoing obligations to demonstrate responsible lending, transparency, and risk management. These factors may stretch operational capacity, particularly for smaller brokers.

Growing Competition and Clawback Risk

2025 is shaping up to be a year of increased competition, as more professionals enter the broking industry drawn by flexible work and earning opportunities. Innovations in personal branding and digital marketing are shaping client acquisition. At the same time, the refinancing wave has brought clawback risk into sharper focus, with brokers needing to actively maintain client relationships to avoid financial setbacks from early loan payouts or refinancing away.

Interest Rate Surprises and Client Oversights

Despite recent rate cuts, not all borrowers immediately benefit. Lender lag in passing on rate reductions, as well as misunderstanding of rate reset schedules, continues to catch clients out. Brokers must educate clients to avoid missed opportunities and costly mistakes, which can erode the perceived value of advice and strain relationships.

Cybersecurity Risks and Settlement Fraud

The growing frequency of scams targeting property transactions presents a real threat. Cases of clients losing life savings to email fraud or settlement diversion have surfaced, putting pressure on brokers and conveyancers alike to implement robust safety protocols and client education measures. Failing to protect clients can lead to reputational damage, increased liability, and regulatory scrutiny.

Conclusion

Mortgage brokers in Australia are navigating a dynamic market. Surging prices and policy backing present many opportunities, while intensifying regulatory demands, fraud risks, and evolving borrower profiles keep the focus on vigilance and quality service. Brokers equipped with strong compliance, proactive client engagement, and awareness of market pitfalls are well placed to succeed in the current climate.