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Rise in mortgage demand coincides with refinancing spike

An increase in demand for home loans has been reported against a backdrop of a rise in refinancing commitments, the latest data from the ABS has revealed.

According to the latest Housing Finance data from the Australian Bureau of Statistics (ABS), mortgage settlements increased by 0.4 of a percentage point in July (52,647), with a total value of $31.4 billion.

The increase was driven by a 1.3 per cent rise in owner-occupied lending, with a total value of $21.1 billion, despite a 1.3 per cent fall in investor lending ($10.2 billion).


The ABS also reported a rise in refinancing settlements, which increased by 3 per cent in July, with 17,084 refinancing commitments for established dwellings.

Reflecting on the figures, Mortgage Choice CEO Susan Mitchell said that the data indicates that borrowers are “shopping around for a better deal”.

Ms Mitchell also noted that she expects refinancing rates to continue increasing amid out-of-cycle interest rate increases from lenders, including three of the big four banks.

The brokerage CEO added that the recent fall in property values could lead to a further increase in mortgage demand in the coming months, with the ABS data also revealing that first home buyer activity (FHB) represented 18 per cent of all housing finance commitments, with the average FHB loan size declining from $349,800 in June to $345,800 in July.

Further, Ms Mitchell encouraged borrowers to review their home loan and capitalise on the increased competition among lenders for high-quality, owner-occupied borrowers.

“The complex lending environment and rising interest rates makes now a perfect time to review your home loan. If you do not know the interest rate you are paying on your loan or are unsure as to whether you are in the right product for your needs, speak to a qualified mortgage professional,” the CEO added.

“Borrowers should keep in mind that lenders will be competing for high-quality borrowers who satisfy new, stricter lending criteria. For this reason, I could urge anyone looking to secure housing credit to get financially fit in order to improve their chances of success when applying for a home loan.”

[Related: Mortgage credit still ‘readily available’, says RBA]

Rise in mortgage demand coincides with refinancing spike

Charbel Kadib

Charbel Kadib is the news editor on the mortgages titles at Momentum Media.

Before joining the team in 2017, Charbel held roles with public relations agency Fifty Acres, and the Department of Communications and the Arts.

You can email Charbel on: This email address is being protected from spambots. You need JavaScript enabled to view it.


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