More than 45 per cent of first home buyers that entered the property market less than two years ago will look to refinance this year, new research has revealed.
According to a survey conducted by Galaxy on behalf of LJ Hooker Finance, more than one in five of those active in the property market are looking to refinance their home loan in the near future.
LJ Hooker chief executive Janusz Hooker said after the 2011 interest rate cuts, home owners are closely watching the market to see what will happen next.
“Our research has shown that new home owners are concerned about interest rates and are very much aware that a spike in the cost of living could affect their home loan repayments,” he said.
Of those planning to refinance their home loans, 20 per cent cited interest rates as their primary concern, with a further 17 per cent needing to refinance to consolidate their debts.
When asked about the management of their finances, only 28 per cent of all home owners stated that they tracked spending through a strict budget. Almost half claimed they were living within their means but felt that an unexpected large bill would put pressure on their finances.
“Although Australians are taking steps to ensure that they are meeting their financial commitments, new home owners are clearly feeling increased pressure to stay on top of bills and mortgage payments,” Mr Hooker said.
“A lot can happen to a family’s living and financial circumstances over two years. New home owners should aim to meet with their broker or lender every 12 months to ensure that their loan product still suits their needs.”
However, not all new home owners are worried about their financial future, the company said. Almost one third of those looking to refinance were hoping to purchase a second, or investment, property.
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