The big four banks are back on top in the mortgage refinancing market, aided by comparatively cheaper funding costs and moves to crush their competition with big cashback offers.
The trend has come after the Reserve Band of Australia increased rates again this month and as property prices are expected to keep falling, keeping competition tight. In addition, the Australian Prudential Regulatory Authority said itMr Gill said the trend towards the majors in all states was being driven by the large sums of cashback money the banks were offering.
RateCity analysis suggests 12 banks are offering a $4000 cashback on a $500,000 loan. All four of the big banks are offering cashbacks for borrowers who are refinancing. “Recent months saw record high refinancing activity for both owner- occupiers and investors. Borrowers continued to switch lenders for lower interest rates as theas ANZ Bank tries to convince the regulators that competition is alive and well in home lending,
“With inflation and soaring interest rates, household budgets are really being stretched, you know, consumers are paying more for goods and services, and they’re also seeing their repayments go up and up as well. It’s a very rational decision,” Mr Gill said.