Refinancing boosts loan volumes
Rising interest rates have prompted a surge in the level of loans being refinanced as consumers look for a better deal. A record $4.2 billion worth of loans were refinanced in December for 20,500 individuals, or one in three new loans. The latest figures from the Bureau of Statistics show that higher rates are deterring investors from entering the market but new-home buyers remain confident. The total value of housing finance fell in December by 0.6 per cent, with loans to investors down 3 per cent. Owner-occupier loans were up 0.5 per cent but this was largely due to the 5.5 per cent increase in the number of people refinancing. First-home buyers now account for 18.4 per cent of the market, below the long-term average of 20 per cent, but better than the average for 2006 of 17.3 per cent.
Source: The Australian Financial Review