Borrowers in search of rate relief have continued to refinance in waves, with the value of total housing loan refinancing still at an elevated $20.2 billion in June, ABS data showed.
The figure was down by 3.1% from the previous month but was 12.6%, or $2.26bn, higher compared to a year ago.
“Refinancing activity has remained at record highs in recent months, as borrowers continued to switch lenders amid interest rate rises,” said Mish Tan (pictured above), ABS head of finance statistics.
Sally Tindall, RateCity.com.au research director, said it was fantastic to see refinancing numbers continue to stay as high as they are.
“While it’s a slight decrease from last month, it’s still the third-highest we’ve ever seen. With hundreds of thousands of borrowers still to come off their fixed rates this year, we’re likely to see the refinancing boom continue.”
New owner-occupier loan commitments (excluding refinancing) tumbled 2.8% to $15.9bn, but investor lending was up 2.6% to $8.7bn, though it was 15% lower compared to a year ago.
For first-home buyers, new loan commitments numbered 8,239 in June, down by 0.8% month-on-month and was 12.2% lower compared to the prior year. The number of loans for first-home buyers in June (8,239) was also nearly half the level seen in January 2021, when first-home buyer lending peaked during the COVID-19 pandemic.
“This, along with the increase in loan sizes, shows just how hard it is to get into the property market,” Tindall said. “With increased prices, it’s no surprise that potential first homeowners are having to rely on the bank of mum and dad to own their first home.”
The value of total new loan commitments for fixed-term finance fell 6.8% over the month of June, driven by a 27.6% fall in lending for personal investment and a 2.7% fall in lending for road vehicle purchases.
Lending for travel and holidays lifted 6.5% to the highest level seen since October 2018, ABS data showed.
What do you think? We’d love to hear from you in the comments below.
