Refinancing has seen a surge in the last month of 2014, hitting its highest level in more than two years.
Data from AFG shows the proportion of home loan borrowers refinancing rose to 37.3% in December, up from 33.5% in September. Refinancing in December accounted for the largest proportion of the home loan market since March 2012, AFG said.
“The last time we saw refinancing at these levels, in March 2012, borrowers were looking to lock in rates, and fixed interest loans reached a four year high,” AFG general manager of sales and operations Mark Hewitt
said. “This time round with speculation that rates are more likely to go down than up, borrowers are shopping around for the variable rate deal and avoiding fixed for the time being.”
First homebuyers, meanwhile, continued to account for only a tiny proportion of the market. First time buyers comprised only 6.9% of all home loans nationally. New South Wales saw particularly dismal first homebuyer participation, with first time buyers accounting for only 1.7% of all new home loans.