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The Reserve Bank of Australia’s (RBA) latest Financial Stability Review reported a sharp increase in high-loan-to-value-ratio (LVR) mortgage lending to first home buyers following the introduction of the expanded 5% deposit scheme on 1 October 2025.
The latest pricing from financial markets suggests that the RBA will raise the official cash rate a further three times this year, bringing it to a 16-year high of 4.85%.
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Recent first home buyers will be hoping that the market pricing of the RBA cash rate has overshot.
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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.