Disclaimer: This article is for informational purposes only and does not constitute financial advice. Please consult a licensed mortgage professional before making home loan decisions.
AFG’s 2026 Data Snapshot: What the Numbers Reveal
Australian Finance Group (AFG, ASX: AFG) runs the country’s largest mortgage aggregation platform. In the December 2025 quarter alone, it processed $40.2 billion in lodgements, feeding a real-time dataset that captures shifts in borrower behaviour 6–8 weeks before official ABS housing finance figures land. Three data points from AFG’s January–February 2026 reporting cycle stand out:
- Total lodgement volume reached $14.1 billion in February 2026 – a 17.2% year-on-year increase and the strongest February reading since record-keeping began in 2014.
- Refinancing share climbed to 42% (up from 34% a year ago), with the average refinanced loan size hitting $561,000.
- Fixed-rate selection jumped to 29% of new flows, double the 14% recorded in August 2025.
These numbers map directly onto three macro forces: the RBA’s 25-basis-point cut in February 2026 that brought the cash rate to 3.85%, a 4.2% national home value recovery per CoreLogic’s March 2026 Hedonic Index, and aggressive repricing by lenders competing for quality borrowers in a tighter serviceability environment.
The Broker Channel Is Now the Price Leader
AFG’s aggregated pricing data reveals a structural shift: broker-originated loans in February 2026 carried an average variable rate of 6.38%, which was 11 basis points cheaper than the average direct-channel rate of 6.49% published by the same panel of 23 banks and non-banks. The gap widens to 15 basis points for loans with a loan-to-value ratio below 70%.
| Channel | Average Variable Rate (Feb 2026) | Average Loan Size |
|---|---|---|
| AFG broker-originated loans | 6.38% | $608,000 |
| Direct-to-lender channel (same panel) | 6.49% | $573,000 |
| Non-bank lenders (AFG flow) | 6.22% | $495,000 |
Data: AFG Mortgage Index February 2026; panel includes major banks, regional banks, and non-bank lenders.
Non-bank lenders now capture 23% of AFG volumes, the highest share since 2022. Their ability to underprice the majors by 16–27 basis points—while still maintaining an average turnaround time of 11 business days—is forcing the big four to offer sharper discounts through the broker network. For borrowers, this means the most competitive rate is increasingly found via a broker who can access both bank and non-bank pricing.
Why AFG’s Lodgement Data Is a Leading Indicator
Official ABS housing finance commitments data (published with an 8-week lag) only tells you what happened. AFG’s lodgement data—the moment a complete application enters a credit team—signals what is happening right now. Because AFG captures roughly 20% of the entire Australian mortgage market through its brokers, the directional trends in its monthly index have historically preceded ABS movements by a median of 47 days.
Q: What can AFG’s lodgement data tell us about the next RBA decision?
When lodgement volumes spike 15%+ month-on-month with a rising refinancing mix, it historically indicates that borrowers are acting on rate-cut expectations. The February 2026 print—showing a 17.2% jump—aligns with futures markets pricing a 70% probability of a second 25bp cut by May 2026. If April lodgements stay elevated, the RBA will have a strong leading signal that lower rates are already transmitting into credit growth, which may influence their next move.
Beyond interest rate speculation, AFG’s data reveals two structural trends that matter more for long-term borrowers:
1. The loan-to-income ratio is edging lower. AFG’s average loan size of $608,000 in February 2026 represents a multiple of 5.4x average household income (based on ABS average weekly earnings data for November 2025). That is down from 5.8x in 2024, suggesting that serviceability constraints—the 3% interest rate buffer on new assessments—are capping loan sizes even as property prices recover.
2. First-home buyers are returning, but carefully. AFG’s first-home buyer (FHB) segment accounted for 19% of lodgements in February, up from 15% a year earlier. The average FHB loan size was $472,000, with 84% opting for a principal-and-interest variable loan. Nearly one-quarter used the Home Guarantee Scheme, which waives lenders mortgage insurance for eligible buyers with a 5% deposit—a policy that the 2025–26 Federal Budget extended with an additional 30,000 places.
How Borrowers Can Use AFG Trends to Reprice or Purchase Smarter
Q: Should I fix my home loan rate in 2026 given AFG’s fixed-rate uptick?
The decision hinges on the spread between fixed and variable rates. As of March 2026, the average 2-year fixed rate tracked by AFG is 5.79%, while the average variable rate sits at 6.38%—a 59-basis-point discount for fixing. Historically, a spread above 50bp has attracted borrowers to fixed products. However, if the RBA cuts rates by another 50bp over the next 12 months as futures markets imply, the variable rate would drop below 5.90%, potentially erasing the fixed-rate advantage. The prevailing advice among AFG brokers is that fixing makes sense for borrowers who value certainty and cannot afford a mid-year rate repricing delay, but borrowers with flexible budgets might keep the loan variable and request a rate match every 90 days.
Q: How can I benchmark my home loan against AFG’s average rates?
AFG’s published average variable rate of 6.38% for broker loans provides a transparent benchmark. If your current owner-occupied variable rate is above 6.50%, you are paying an above-average rate and likely have room to reprice. Data from the ACCC’s 2025 Home Loan Price Inquiry showed that loyal borrowers on loans older than three years paid an average premium of 26 basis points relative to new customers at the same lender. Use the AFG average as a conversation starter: request your lender match or beat 6.38%. If they refuse, a broker can often access an equivalent or lower rate from a non-bank alternative without restarting the full application process—many lenders now accept a broker-initiated reprice with a simple variation letter.
State-by-State Lending Patterns in AFG’s 2026 Index
AFG’s state breakdown highlights where mortgage demand is running hottest and where affordability thresholds are most stretched:
| State | Lodgement Growth (YoY Feb 2026) | Average Loan Size (Feb 2026) | Refinance Share |
|---|---|---|---|
| NSW | +22.4% | $732,000 | 45% |
| Victoria | +14.8% | $621,000 | 41% |
| Queensland | +19.1% | $548,000 | 39% |
| WA | +11.3% | $509,000 | 37% |
| SA | +15.6% | $475,000 | 38% |
Source: AFG Mortgage Index, February 2026.
New South Wales is the clear standout, driven by Sydney’s median dwelling value reclaiming $1.35 million in March 2026 (CoreLogic). Refinancing activity in NSW is also the highest nationally, suggesting mortgage stress—or at least rate sensitivity—remains elevated despite falling rates. In contrast, Western Australia’s more moderate growth and smaller loan sizes reflect an economy still digesting post-mining-boom capacity, with Perth dwelling values up only 1.9% over the year.
The Regulatory Backdrop: Serviceability and Credit Policy in 2026
APRA’s 3% serviceability buffer remains in place as of March 2026, unchanged since October 2021. That means every new loan application is assessed on the ability to repay at the contracted rate plus 3%, or a prescribed floor rate, whichever is higher. With the average new variable rate now at 6.38%, the assessment rate is 9.38%, which continues to cap borrowing capacity for middle-income households.
AFG’s data indirectly captures the buffer’s impact: the proportion of loans with a loan-to-income ratio above 6x fell to 11.2% in the December 2025 quarter, down from 16.8% at the end of 2022. Borrowers are not stretching their income multiples as aggressively, and brokers are proactively guiding clients towards lower LVR products to avoid the buffer squeezing their limit. This dynamic partly explains the non-bank lender resurgence—several non-banks offer tiered pricing that rewards sub-70% LVR with rates approaching 5.99% for owner-occupiers, a full 39 basis points inside the AFG panel average.
Q: Will APRA change the serviceability buffer in 2026?
APRA’s most recent statement in February 2026 reiterated that the buffer would remain under review but noted that “a material and sustained decline in the cash rate could provide scope to calibrate the buffer lower.” If the RBA cuts to 3.60% or below by September 2026, an adjustment to 2.5% becomes a live possibility. AFG’s lodgement data would likely give the first signal of credit loosening: watch for a sudden rise in maxed-out loan-to-income ratios alongside a jump in investor lending, which AFG can disaggregate from the overall mix.
References and Data Sources
- AFG Mortgage Index – February 2026 – Primary data source on lodgement volumes, fixed/variable mix, broker pricing, and state-level trends. Published monthly, free access.
- RBA Cash Rate Target – February 2026 Decision – Official cash rate announcement and accompanying statement on inflation and housing credit.
- CoreLogic Home Value Index – March 2026 – National dwelling value movements used to contextualise AFG’s average loan size trends.
- APRA Quarterly ADI Property Exposures – December 2025 – Serviceability buffer details and actual assessment rate data, confirming the 3% buffer remains in effect.
- ACCC Home Loan Price Inquiry – 2025 Final Report – Evidence of loyalty tax and pricing opacity, supporting the argument for repricing using broker benchmarks.