The number of owner-occupiers looking for new mortgages or to refinance will increase over 2016 as they look to take advantage of the current low interest rates on offer, according to the head of a major mortgage franchise.
According to figures from Aussie Home Loans, the December 2015 quarter saw a 27.6% increase in the number of owner-occupiers looking to refinance their mortgages, while there was a 6.5% increase in the number of first home buyers looking for loans.
The three-month period also saw loans for property investment purchases fall 10% lower than they were at the same time in 2014.
Aussie Home Loans chief executive officer James Symond said it is unlikely that demand from home buyers will fall away anytime soon.
“We expect the refinancing and owner-occupier purchases to continue to grow in 2016 as borrowers become more confident that the current historically low interest rate conditions will continue well into the year,” Symond said.
“Borrowers are getting the message that now is the right time to save money on their mortgage repayments through refinancing, with many continuing to make payments at higher levels to get ahead on their mortgage,” he said.
Symond said the rates currently on offer are giving borrowers the chance to save significant amounts of money.
“Our figures show that more and more of our customers are taking advantage of record low interest rates. They are actively seeking out and securing themselves a better deal, saving tens of thousands of dollars in many circumstances,” Symond said.
Based on Aussie’s average refinance loan size of $525,331, the average 0.71% rate saving equates to $240 on monthly repayments on a 30 year loan.
Refinancers in NSW are making the most of refinance savings with an average 0.75% reduction, followed closely by Queenslanders saving an average 0.73% on their home loan interest rate.
With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now
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