Investor activity in the housing market has reached record levels, driving up prices and leaving first home buyers out in the cold.
Loans for first-home buyers fell to a record low of 12.2 per cent of all home loan approvals in July, official figures show.
Meanwhile, loans for investors accounted for almost 50 per cent of loans written to buy housing in July, the highest share on record, Commonwealth Bank economist Gareth Aird said.
"Low interest rates and the expectation of future capital gains mean that investors in Australia are currently the major driver of the property market," he said.
"One consequence is that rental growth is likely to be weak as the proportion of dwellings available for lease lifts."
CommSec economist Savanth Sebastian said there was also anecdotal evidence that some first-home buyers were being squeezed out of the market by investors, given limited housing supply.
But the figures also reflected the fact that young people prefer to rent rather than buy, he said.
Policymakers have expressed concern at the investor-driven property price surge, Mr Aird said, and that was likely to continue in the wake of Tuesday's figures.
Price rises were locking first-home buyers out of the market, he said.
"Last week, Reserve Bank governor Glenn Stevens all but ruled out any further rate cuts by stating that `further inflating an already elevated level of house prices seem an unwise route'," Mr Aird said.
"Today's data suggest that there is no sign of cooling momentum in the housing market, particularly in respect of loans to investors.
"After today's figures we can expect more commentary from RBA officials around concerns in the housing market."
RBC Capital Markets strategist Michael Turner said investor finance spiked "uncomfortably" high in July.
The level of activity for owner-occupiers, excluding refinancing, remained stagnant and below decade averages, he said.
"The jump in investor finance would be unwelcome on financial stability grounds at the RBA, which has again started to warn over expectations built on what it sees as unrealistic assumptions of house price inflation," Mr Turner said.
The ABS said it was investigating whether under-reporting of first-home buyer activity was occurring.
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