Refinancing reached a new high of $17.2 billion in July 2021, according to the Australian Bureau of Statistics.
The first home buyer segment plummeted in the same time period, falling 7.6% month to month and down 17.4% from its peak in January.
Fixed rate loans have also nearly overtaken variable rates as borrowers race to get the best rate they can, rising from a low of beneath 20% of the market - when variable was, consequently, above 80% - to north of 40%.
With most banks now raising their long-term interest rates in anticipation of an RBA cash rate rise ahead of schedule, customers are clearly attempting to lock in a 2021 rate for the long-term.
“The value of refinancing between lenders was 60 per cent higher in July 2021 compared to a year ago,” said ABS head of finance and wealth Katherine Keenan.
“This reflected borrowers seeking out lower interest rates, particularly for fixed rate loans, and cashback deals across a large number of major and non-major lenders.”
“First home buyer lending fell across all states and territories, with the largest fall seen in Victoria, followed by Queensland and New South Wales.”
“While these falls were still tied to the unwinding of strength in construction lending post-HomeBuilder, the decline in first home buyer loan commitments now appears more widespread.”
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