Rising property prices and growing confidence among investors have helped lift mortgage size to a new record according to the latest figures from Australian Finance Group (AFG).

During November, the average mortgage rose to $367,000 with Victoria recording the highest growth at 12.1% to $352,216. NSW saw a 10.7% increase while Queensland remained steady.

Investors continued to return into the market - now accounting for one in three of all new mortgages arranged (33%) - the highest level for the year.

"Larger average mortgages and greater activity by investors are usually the signs of a confident market. But confidence is still fragile," said Mark Hewitt, general manager of sales and operations at AFG. "October and November are seasonally strong months in the calendar, but we've seen two straight months of decline. In our view, the RBA has gone too far too fast in ratcheting rates back up again."

AFG also noted that non bank lenders are starting to gain some grounds against the banks. During the third quarter, non bank lenders accounted for 11.7% of all mortgage sold compared to just 7.5% in the first quarter. Banks continued to dominate, taking more than 88% of all mortgage sold in the third quarter. "This suggests that second tier lenders are becoming somewhat more competitive as global credit conditions ease," said Hewitt.