Australia’s lenders are widely expected to target the refinancing market, according to new research.
Data from the Australian Bureau of Statistics shows refinanced home loans grew 5 per cent in March 2011 in comparison to March 2010.
There were 658 more borrowers who refinanced in March compared to 12 months prior, while the total home loans market is at the lowest level in a decade, with a 5 per cent fall in activity comparing the same period.
Across the country, Victoria had the highest proportion of refinanced home loans out of all home loans taken out in March with 34 per cent according to data from RateCity, followed by Queensland and Western Australia both with 30 per cent. New South Wales saw 29 per cent of home loans towards refinancing in March, while Tasmania, Northern Territory and Australian Capital Territory had the least number of refinancing activity with 26 per cent.
RateCity’s chief executive Damian Smith said lenders had already started to target this market segment.
“UBank has set the benchmark for the best home loan rates in Australia, by reducing the waiting time to receive their 0.20 percent loyalty discount from three years to immediately from taking out their UHome Loan,” he said.
“This home loan is only available to refinancing borrowers who want to switch from another lender and it’s cleverly targeted at this market where all the activity is currently at compared to last year.
“It will be interesting to see how the home loans market changes in the coming months and we’ll be watching it closely as we expect competition to heat up.”