Major banks lift first-home buyer share, but brokers maintain dominant market position
Australian Finance Group (AFG) has reported its highest quarterly mortgage lodgement volume on record, with its Q2 FY26 AFG Index showing a sharp rise in activity and a new benchmark for second-quarter performance.
The aggregator recorded $31.6 billion in lodgements for the quarter, a 3% increase on Q1 and 25% above its previous best second-quarter result. This lifted first-half FY26 lodgements to $62 billion.
“This quarter’s record lodgement volume highlights the critical trust AFG brokers continue to earn in supporting Australians seeking access to competitive finance solutions,” said David Bailey (pictured top), chief executive of AFG. “Their expertise and commitment are evident in the strong uplift across multiple borrower segments.”
First-home buyer applications rose from 11% to 13% of total lodgements, the highest level since FY22. Activity in this segment remains constrained, with AFG pointing to affordability pressures and the market’s anticipation of new government schemes.
“While we’ve seen a lift in first-home buyer activity, broader affordability pressures remain. Our brokers are working closely with borrowers navigating purchasing power and competitive market conditions,” Bailey said.
Refinancing volumes fell to 16% of total business, the lowest proportion recorded by the index. “This shift reflects changing borrower behaviour,” Bailey commented.
“The refinancing wave that defined prior periods has moderated. Brokers continue to be well positioned to support customers with their lending decisions and future opportunities.”
AFG-branded home loan products accounted for 7.6% of all lodgements in the quarter. Of this, 71% were for AFG Securities products, which the group described as a record share.
The quarter also showed a relatively even split between major and non-major lenders. AFG reported that major banks achieved their highest share of first-home buyer business since Q1 FY17, suggesting continued reliance on the broker channel by larger institutions.
“Despite commentary suggesting a shift back to what is now a much smaller branch network, the data tells a different story,” Bailey said. “With broker market share sitting above 77%, the channel remains vital for borrowers seeking choice, competition, and support in a complex credit environment. Potential changes in the interest rate environment will drive more engagement, and that is a positive for brokers.”
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