Homeowners stay put as renovation activity heats up

author thumbnail

Tom Watson

07 Sep 2017

redactor/hero-images/98/Home_Renovation_FINAL_content.jpg

The number of Australians making renovations to their homes during the June quarter grew by 2.2 per cent according to the Housing Industry Association, while new dwelling construction declined.  

Mozo’s home loan and property expert Steve Jovcevski said that the increase in renovation activity is a sign than many homeowners are turned off by high housing prices and stamp duty costs.

“It doesn’t surprise me that homeowners are opting to renovate rather than sell up,” he said.   “When you consider that on a $750,000 home in NSW you could pay around $29,000 in stamp duty, it’s no wonder people prefer to funnel that money into renovations on their current home instead of the government’s coffers.”

And the good news for renovators is that home lenders this spring are keen to attract mortgage holders wanting to tap into the increased equity in their home to fund renovations.   

Since June 1, 29 lenders have made cuts to both fixed and variable home loan rates for owner occupiers, with rates as low as 3.54% for refinancers with an LVR of 80%. Check out a range of top refinance home loans currently on the market below, or for ideas on renovation trends head over to our renovation guides hub.

Top 5 Refinance Home Loans - rates updated daily

  • Promoted

    loans.com.au

    2.88% p.a.

    2.90% p.a.

    $1234

    Product details Close details
    Go to site
    Smart Home Loan

    A low-rate home loan that could save you thousands. No ongoing fees. Unlimited additional repayments. Unlimited free redraws with no minimum redraw amount, Limited time only.

    • $0.00

    • $0.00

    • yes - free

    • yes - free

    • no

    • 2.88% p.a.

    • 2.90% p.a.

    • $520

    • 80.00%

    • $50,000

    • $1,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Smart Home Loan

    Go to site

  • Promoted

    UBank

    2.84% p.a.

    2.84% p.a.

    $1234

    Product details Close details
    Go to site
    UHomeLoan - Discount Offer

    Free redraw with flexible repayments. Min 20% deposit. Winner of a Mozo Experts Choice Award 2019 in the Low Cost Home Loan category^.

    • $0.00

    • $0.00

    • yes - free

    • yes - free

    • no

    • 2.84% p.a.

    • 2.84% p.a.

    • $0

    • 80.00%

    • $200,000

    • -

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the UHomeLoan - Discount Offer

    Go to site

  • Promoted

    Athena

    2.84% p.a.

    2.80% p.a.

    $1234

    Product details Close details
    Go to site
    Variable Home Loan

    Get the low rate you deserve with Athena, one of Australia's newest direct lenders. No fees and fee-free redraw. The same low rates for new and existing customers. Score loyalty bonus for making repayments. Min 20% deposit.

    • $0.00

    • $0.00

    • yes - free

    • yes - free

    • no

    • 2.84% p.a.

    • 2.80% p.a.

    • $0

    • 80.00%

    • $100,000

    • $2,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Variable Home Loan

    Go to site

  • Promoted

    Heritage Bank

    3.07% p.a.

    3.12% p.a.

    $1234

    Product details Close details
    Go to site
    Discount Variable Home Loan

    No monthly administration fees. Ability to make extra repayments and redraws. A great low rate. No ongoing fees. Experience the difference this established bank has to offer.

    • $0.00

    • $250.00

    • yes - free

    • yes - free

    • no

    • 3.07% p.a.

    • 3.12% p.a.

    • $750

    • 80.00%

    • $150,000

    • -

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Discount Variable Home Loan

    Go to site

  • Promoted

    IMB Bank

    3.13% p.a.

    3.19% p.a.

    $1234

    Product details Close details
    Budget Home Loan

    Start with only 10% minimum deposit. Unrestricted additional repayments and free redraw facility.

    • $0.00

    • $350.00

    • yes - free

    • yes - free

    • no

    • 3.13% p.a.

    • 3.19% p.a.

    • $799

    • 90.00%

    • $75,000

    • $5,000,000

    • Variable

    • Principal & Interest

    • Owner Occupier

    • Weekly, Fortnightly, Monthly

    Read our Mozo Review to learn more about the Budget Home Loan

*WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for the amount and term you entered.

**Initial monthly repayment figures are estimates only, based on the advertised rate, and a loan of $500,000 repaid over 25 years. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

Steps to refinance to fund a renovation

Step 1. Work out a renovation budget. Whether you get professional help from an architect, landscaper or builder to work out how much you’ll need to do the changes to your home that you want, or you just work backwards from a lump sum amount you think you can afford, having a budget in mind before you speak with your lender or do any of the work is super important.

Step 2. Compare home loan deals.  Before you just get in contact with your existing home lender to discuss your renovation budget, it’s a good idea to compare rates from other lenders in the market. Not only will this help you when negotiating with your existing lender if you decided to refinance with them, it will also help you get up to speed on new features or options that may not have been available when you first took out your home loan. Mozo’s Switch & Save Calculator is a good place to start - it compares over 100 home loans in our database that are available now.

Step 3. Refinance. Once you’ve found a home loan that ticks the boxes for you, you can kick off your refinancing application. Be sure that you’ve also done your homework around any mortgage discharge costs or upfront costs that you might need to pay when switching home loans.

Mozo may receive advertising fees from the financial institutions, issuers of financial or credit products and third party advice providers that are shown on this page. These fees are based on a cost per click, cost per acquisition, or a fixed fee.

Man celebrating as home loan rates drop to new lows content

Well Home Loans slashes fixed and variable rates to smashin’ new lows

Westpac rolls out interest-free home loans to assist bushfire victims

Tell me more
Bank australia clean energy home loan original

Bank Australia teams up with CEFC to launch new clean energy home loan

Mortgage brokers don't necessarily offer the best deals... here's why

Tell me more
Best online mortgages content

The best online mortgage lenders in Australia

ANZ the latest bank to waive Lenders Mortgage Insurance for lawyers and accountants

Tell me more
Online home loans 2020 content

Online home loan lenders to put on your house hunting list in 2020

Why the bigger banks aren’t always the best place to find a home loan in 2020

Tell me more
Refinance home loans hero image content

Australia’s best refinance home loans for 2020