Hundreds of thousands of Australians are set to receive a call from their banks as loan repayment deferrals begin to end in September and October for some mortgage and business customers.
From choosing your ideal suburb to furnishing your new digs, there’s plenty to get excited about when buying a home. For most people, the first thing on the to-do list should be finding a perfect home loan fit.There’s heaps of choice in this area. Even with a single lender, there could be a dozen home loan options to investigate. Plus, during times of economic uncertainty (aka the COVID-19 world) the details of these offerings can change regularly.If you’ve skimmed the options and are feeling overwhelmed, here are some of the questions you should be asking. It’s kind of like a personality quiz, but for home loans.
Home loan refinancing activity is on the rise in NSW, and according to a new report from the NSW Land Registry Services, it’s the big banks that are benefiting the most.The LRS found that more customers were moving away from the major banks than were coming on board in the months leading up to COVID-19, but after the pandemic struck that trend was reversed.Since then, the big four have been the only segment to see a substantial increase in share of refinances. Meanwhile, refinances to non-ADI lenders, other domestic banks, foreign ADIs and customer owned banks have decreased.In August alone, the number of customers flocking to the big banks from other lenders accounted for 70% of refinances in NSW, an increase of 15% on the same month last year.In total, the major banks won over 5,195 refinancers over the month, outperforming other domestic banks (+1,311), customer owned banks (+458), foreign ADIs (+412), and non-ADI lenders (+346).The major banks continue to dominate the home loan space, making up 67% of mortgages recorded on titles in NSW. This represents an increase in volume of 19% from the previous year.
When was the last time you performed a home loan health check? Mortgage rates have plummeted over the past year, so if you haven’t made the move to refinance your home loan already you could be missing out on serious savings.
Overnight, major bank NAB launched a $2,000 cashback offer for refinancers across a range of its home loan products. For customers looking to refinance before 31 January 2021, the cashback is available on the following loans:
Easy Street, a division of Community First Union, introduced a contender for best value home loan this week. Its Standard Variable Home Loan now offers rates as low as 1.95% p.a. (1.99% p.a. comparison rate*) on loans of at least $750,000. The loan doesn’t charge any monthly or annual fees and comes with a number of features, such as an offset account, fee-free redraw facility and the ability to make free extra repayments. There is, however, an application fee of $500.John Tancevski, chief executive of Community First Credit Union said it was the lowest home loan rate they have ever offered and “is evidence that it is possible to offer an exceptionally low rate without scrimping on loan features.”
While the rug hasn’t been pulled out from underneath the property market just yet, prices continue their gradual descent, with the CoreLogic home value index recording a decrease of 0.4% in August. This marks the fourth consecutive month property prices have fallen, however the rate of decline has slowed compared to previous months.CoreLogic head of research, Tim Lawless said Melbourne continues to lead the decline, with home values falling by 1.2% in August and 4.6% since the onset of the pandemic.“It’s not surprising to see Melbourne as the weakest housing market considering the extent of the virus outbreak, and subsequent restrictions, which have weakened the economic performance of Victoria,” he said.Among capital cities, only Darwin (+1%), Canberra (+0.5) and Hobart (+0.1) recorded increases in dwelling values. Elsewhere, property prices held steady or decreased only slightly, as in Sydney and Brisbane, where prices fell by 0.5% and 0.1%, respectively. Lawless expects diverging outcomes across markets as states experience varying degrees of success in containing the virus. Reliance on overseas migration as a source of housing demand will also result in uneven impacts.“The performance of housing markets are intrinsically linked with the extent of social distancing policies and border closures which also have a direct effect on labour market conditions and sentiment,” Lawless said.
Competition for borrowers continues to remain fierce heading into spring, with lenders cutting their sharpest variable and fixed mortgage rates by even greater margins and offering up more incentives for refinancers to switch loans.
ME Bank has joined the swelling ranks of lenders making cuts to short-term fixed home loan rates by reducing a number of offers between 20 to 40 basis points.