AFG, the Perth-based aggregator, has reported a slide in WA home loan lodgements heading into spring and pointed the finger at federal Labor policy settings. For Perth buyers that does not mean lenders have stopped lending. It means your file needs to be sharper, your lender choice needs to be deliberate, and timing matters more than it did a year ago.
What AFG actually said, and why Perth should listen
Australian Finance Group sits in West Perth and processes home loan applications from thousands of brokers across the country. When their lodgement data moves, it tends to show up in bank approval queues a few weeks later. So when AFG flags a slide in WA volumes, it is worth more than a passing glance.
According to The West Australian's report, AFG has framed the WA drop as a spring warning and laid responsibility at the feet of federal Labor. I am not going to repeat the headline figures here because they shift with each quarterly update. Read the article for the exact numbers.
What I can tell you is what I see from my desk in Osborne Park. Enquiry is still strong. Pre-approvals are still being issued. But the gap between people wanting to buy and people actually lodging a loan has widened. Serviceability, deposit size and stock levels are doing the sorting, not lack of interest.
What is behind the slide in WA lodgements
There is no single cause, and anyone who tells you otherwise is selling something. Three things are compounding at once. First, Perth prices ran hard over the last couple of years, so the same deposit buys less in Morley, Balga or Cannington than it did. Buyers who were ready in 2023 are now short.
Second, lending rules have not loosened. APRA still requires banks to assess you at a buffer above your actual rate, and you can read the current serviceability guidance at apra.gov.au. That buffer is the quiet reason so many Perth couples get told their borrowing capacity is $80-120k less than they expected.
Third, stock. REIWA has been reporting tight listings across the metro area for a long stretch now, and you can check the latest weekly figures at reiwa.com.au. When there are fewer homes to buy, there are fewer loans to lodge. That shows up in AFG's data regardless of who is in Canberra.
AFG's criticism of Labor centres on policy settings they believe are suppressing supply and confidence. Whether you agree with that reading or not, the practical effect for a buyer in Perth is the same. Fewer settled deals means lenders are hungrier for the good files that do come through, and that creates opportunity if you prepare properly.
What this means for Perth borrowers right now
Lenders respond to lower volumes by competing harder on the applications they can win. In practice that looks like sharper rates for clean owner-occupier files, cashback offers reappearing from some of the majors, and credit teams turning around straightforward deals faster. If you have steady PAYG income and a genuine deposit, you are in a strong negotiating position.
The flip side is that the lenders are not relaxing their credit policies. If your file has a wrinkle, whether that is casual income, a short ABN history, a recent credit default or a deposit made up mostly of a parental gift, you need to pick the lender whose policy matches your situation rather than firing applications at the big four and hoping.
For first home buyers, this is also the moment to look seriously at Keystart. As the WA government lender, Keystart offers low deposit loans without lenders mortgage insurance, and their income and property price limits are published at keystart.com.au. Many buyers in Ellenbrook, Byford and Baldivis use Keystart as a stepping stone, then refinance to a mainstream bank once they have equity.
For investors, slower lodgement volumes can mean less competition at auction and at private treaty. Perth rental vacancy has been tight, and that supports rental yields in suburbs like Armadale, Gosnells and Midland. Just make sure your lender assesses rental income at a rate that reflects the actual lease rather than a heavy haircut.
A worked example: Priya in Balcatta
Priya is a registered nurse at Sir Charles Gairdner Hospital. She earns around $95-105k including regular shift penalties, has no HECS left, a $12k car loan and a credit card with a $6k limit she rarely uses. She has saved $55-65k and wants a three bedroom villa in Balcatta or Stirling, where she is seeing listings in the $600-700k bracket.
Her first conversation with her own bank went badly. They assessed her shift penalties at a discount, counted the full credit card limit, and applied the standard buffer. She came away with a capacity that would not get her past $550k. That is the exact pattern AFG's data is describing. Priya wanted to buy, but she did not lodge.
When we sat down, we did three things. We compared lenders that accept a higher percentage of overtime and shift allowances for essential workers. We closed the credit card, which lifted her capacity by a meaningful chunk. And we tested a Keystart option alongside a mainstream lender under the federal Home Guarantee Scheme, where current price caps and eligibility are listed at housingaustralia.gov.au.
The result was a pre-approval in the $640-680k range with a mainstream lender, LMI avoided through the guarantee, and a backup Keystart approval if a particular property fell outside the scheme caps. Priya made an offer on a villa in Balcatta two weeks later. The difference was not her income. It was lender selection and file preparation.
How a Central Lending Solutions broker helps
We compare 30+ lenders, including Keystart, from one application. That matters more when volumes are soft because the policy differences between lenders become the whole game. One bank will take your casual income after three months, another wants twelve. One treats a gifted deposit as genuine savings, another will not. We know which is which.
Since 2015 we have settled more than $1.2B in loans from our office at 129 Hasler Road, Osborne Park, and we have 311+ five-star Google reviews from Perth families who were told no elsewhere. Harj Dhillon and I run the business, and Aoife Farrell, Keeley Rodgers, Jono and Jonny handle files every day across first home buyers, upgraders, investors and self-employed clients.
We hold Australian Credit Licence 497 950 and are MFAA members, so you are dealing with licensed brokers under a professional code. There is no fee to you for a standard residential loan because the lender pays us on settlement. If we cannot find a better outcome than the one you already have, we will tell you straight.
Practically, here is what a first chat looks like. You call 0489 082 257, we spend twenty minutes understanding your income, deposit and the suburbs you are looking at, and we come back with a realistic borrowing range across the lenders that suit you. No credit enquiry is lodged until you decide to proceed.
Things to do before spring listings land
- Pull your free credit report and fix any errors before a lender sees them.
- Close or reduce credit card limits you do not use. Lenders count the limit, not the balance.
- Get three months of clean bank statements. Cut the gambling apps and buy now pay later accounts.
- Have your deposit sitting in one account with a clear savings history.
- Check Keystart and Home Guarantee Scheme eligibility if you are a first home buyer.
- Get a written pre-approval, not just a calculator estimate, before you inspect anything.
The buyers who settle in a soft lodgement market are not the ones with the biggest incomes. They are the ones who turn up to the agent with a real pre-approval from the right lender.
Frequently asked questions
Does a slide in WA home loan lodgements mean banks are tightening?
Not in my experience. Lenders have not materially changed their credit policies in response to AFG's data. What has changed is that fewer buyers are clearing the existing hurdles. If anything, lower volumes make lenders more competitive for the files that do come through, so a well prepared application can attract sharper pricing than it would in a busy market.
Should I wait for rates to fall before buying in Perth?
Nobody can promise you where the cash rate lands, and you should read the RBA's own statements at rba.gov.au rather than take anyone's forecast as gospel. What I will say is that waiting for rates while Perth prices keep moving has cost plenty of buyers more than a rate cut would have saved them.
Is Keystart only for people who cannot get a bank loan?
No. Keystart is a WA government lender designed for low deposit buyers, and plenty of our clients with perfectly good credit use it because it avoids lenders mortgage insurance. The rate is usually higher than a mainstream bank, so the common strategy is to buy through Keystart, build equity, then refinance after a couple of years.
How much deposit do I really need in Perth right now?
It depends on the path. Under the Home Guarantee Scheme or Keystart, a 5% deposit plus costs can be enough if you fit the eligibility rules. With a mainstream lender outside those schemes, 10-20% keeps LMI manageable. On a $600k purchase that is somewhere between $30k and $120k depending on which door you walk through.
Will shift work or overtime income count toward my borrowing capacity?
With the right lender, yes. Some banks accept a high share of shift allowances for nurses, police, FIFO workers and other essential workers with a consistent history. Others discount it heavily or require two years of evidence. This is one of the biggest sources of difference between lenders, and it is exactly why Priya's outcome changed so much.
Does the political blame game between AFG and Labor actually affect my loan?
Directly, no. Your approval depends on your income, deposit, credit history and the lender's policy on the day you apply. Indirectly, policy decisions on supply, migration and tax settings shape the market you are buying into. Worth following, but not worth delaying a good purchase over. Focus on what you control.
Ready to talk it through?
If the headlines have you wondering whether now is the moment or whether to sit tight, let us look at your actual numbers. Call me on 0489 082 257 or book a free chat at centrallendingsolutions.com.au/contact. Twenty minutes at the kitchen table, or over the phone, and you will know exactly where you stand.
