Borrowers were on a refinancing spree over the last month, with activity rising on a monthly and annual terms across New South Wales, Victoria, Queensland, and Western Australia.

PEXA’s latest data showed that refinancing activity in New South Wales, Victoria, and Queensland rose by at least 10% and by 6.9% in Perth over the month of June.

On an annual basis, Queensland reported the biggest jump at 37.1%, followed by Western Australia at 27.3%.  

Annual refinancing volumes also increased in Victoria and New South Wales, albeit at a slower rate of 11% and 7.1%, respectively.

Zippy financial director Louisa Sanghera said while many borrowers are considering refinancing and fixing their loans amid the rising rate environment, doing so might not be practical given that fixed rates are still higher than variable rates.

“Fixed rates are already in the 4% to 6%, depending on the fixed loan term, which is generally well above the current variable option in most cases – even after the three successive cash rate increases recently,” she said.

“Anyone wanting to fix the rates on their mortgages ideally should have done so last year when rates were in the one to two per cent range.”

New loans down annually

Interestingly, the PEXA data also showed a downtrend in new loans compared to last year, with all four states reporting a decline.

New South Wales registered the biggest drop at 18.4% while Victoria and Queensland reported smaller declines of 7.1% and 4.4%, respectively.

Western Australia also posted a decrease, albeit only at a marginal rate of 0.2%.

On a monthly basis, however, increases were recorded except in New South Wales, which hit a 1.2% drop.

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