Refinancing Peaks

The recent flurry of mortgage refinancing most likely peaked last year, according to electronic conveyancing group PEXA. At its highest point last year, refinancing reached 24.2% of all transactions.

The total number of properties changing hands fell to 2.06 million in the six months to June, according to PEXA chief executive Glenn King. King believes the market has bottomed out. “What we can also say is while refinancing will still be strong, if we’re seeing any improvement in the market, the proportion may not be to the same degree.” King says a lot of the refinancing activity was from homeowners who were coming out of fixed rate loans which were locked in during the pandemic. He says fears that a so-called mortgage cliff would cause widespread financial pain as owners come out of low fixed rates on to higher variable rates, had not yet materialised. The big banks agree with the biggest lender, Commonwealth Bank, saying the change was not noticeably pushing up arrears.