Home owners give PEXA their top reasons to refinance

"PEXA research shows rate rises are not the only reason people are choosing to refinance their mortgage. Most people had about three reasons they decided to switch. "

Residz Team 3 min read


Even before the RBA’s latest interest rate hike, more than one in 10 mortgage holders said they had refinanced or planned to refinance their mortgage.

With eight mortgage interest rate rises in a row (and more to come), recent PEXA Refinancer Sentiment Research showing 12.9% of mortgagees were refinancing might be just the beginning of a bigger mortgage march.

If inflation doesn’t fall and interest rates keep rising, we may well see a lift from the 2.48 million of the roughly 8 million mortgage holders who refinanced their home loan in the past year (or said they intended to in the next 2 years).

But, rate rises are not the only reason for refinancing. Most people had about three reasons they decided to switch.

Let’s look at PEXA’s recent data on all the reasons people want to change loan providers.

Wanting a better/more competitive interest rate was the main reason to refinance for 29% of survey respondents, and a contributing factor for 22% of respondents who named another main reason.

‘I needed to save money to help my overall position’ was chosen by 9% as their main reason for refinancing, and 23% chose it as a factor.

Recommendation from a broker/advisor was the top motivation for 8%, and a factor for a further 17%.

My personal situation has changed/is changing was top for 8% and another reason to refinance for 16%.

Wanting to lock in a fixed rate was chosen by 7% as a main motivation for refinancing, with 16% naming it as another reason.

My fixed loan term has ended/is ending was the main reason for 7% and a factor for 15%.

I am anticipating an increase in house prices was a main reason for 4% (a factor for 17%).

Lender incentives (e.g. cashback offers, competitive rates etc.) prompted action for 5% (with 14% naming it as ‘other reason’).

I/we are planning to renovate or make improvements to my home was a main reason for 6% and a reason for 13%.

Wanting to change to a different type of home loan product was key for 3% and a factor for 16%.

My current lender has/had high fees was chosen by 4% (and as ‘other reason’ by 14%)

I saw something in the media that prompted me was given as the main reason to refinance by 2% but was still a factor for another 14% of home owners.

Wanting to consolidate all my banking accounts with one bank was top for 3% and one of the reasons to finance for 11%.

I am/was dissatisfied with my current lender was top for 2% and a factor for a further 10%.

Wanting a lender with better digital tools (ie. online banking) was a main motivation for 2% and something of a motivation for 7%.

And for 1% there was another unspecified reason to switch altogether.

PEXA says their research shows home owners who switched lenders achieved on average an annual saving of $1,908* and it took 4.2 weeks to finalise the refinance.

Home owners who refinanced with their existing lender achieved on average a $384 annual saving, completing the refinance faster in three weeks.

The PEXA Refinancer Sentiment Research was commissioned by PEXA and undertaken by Nature Research.

Residz can help buyers and sellers reduce the stress:

*Calculated using stated savings from Recent Refinancers in survey and based on an average loan size of $610K as reported by ABS in Jun-22.

Photo by Joshua Hoehne on Unsplash