Refinancing should boost mortgage lending activity in 2021



Sarah buckley

05:45, 12 Jan 2021

4 minutes to read

Brokers believe refinancing activity will continue to drive mortgage activity in 2021, according to the latest research from a non-bank lender.

According to Resimac’s monthly brokerage survey, the majority (40%) of brokers surveyed predicted that refinancing would continue to drive home lending activity in 2021, after strong growth in 2020.

Indeed, during the outbreak of the COVID-19 pandemic last year, the vast majority of home loan applications were for refinances – as the purchase of new homes slowed amid COVID-19 restrictions and breaks. auction. Many broker groups also reported record deposits in 2020, driven by refinancing activity, while the most recent statistics from the New South Wales Land Register show that refinancing activity increased by 22% in 2020.

It is this trend that, according to brokers, will continue in 2021.

According to the Resimac survey, 40 percent of those polled believe refinancing will boost business this year, while more than a quarter say most of the business will come from first-time buyers.

Daniel Carde, Managing Director of Distribution of Resimac, commented: “The refinancing activity has helped keep the mortgage market active throughout the past year, and we expect continued growth in this space throughout. 2021, especially from those who are currently still in the process of getting back on their feet after the initial lockdown. “

The Resimac survey also asked brokers what they think about the evolution of cash rates this year.

He found that 80 percent of those polled believe the Reserve Bank of Australia will keep the cash rate stable over the next 12 months; however, about 10 percent believe it could decline further this year.

The central bank previously suggested that it would not increase the cash rate for “at least three years”, Or at least until there is a drop in the unemployment rate and a return to a“ tight ”labor market.

Speaking of the results, Mr Carde said: “When it comes to interest rates, all signs are that they remain relatively stable for the foreseeable future.”

[Related: Happy New Year? Predictions for 2021]

Refinancing is expected to boost mortgage lending activity in 2021

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Last updated: January 12, 2021

Posted: January 12, 2021

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