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Home buyers search for ways to save as rates rise

Home buyers searching for information on interest rate rises exploded in 2022, with new research suggesting thousands of Australians are looking to cope with higher borrowing costs.

Analysis by Great Southern Bank shows Google searches about “interest rate rises” jumped 750 per cent in the past year, while enquiries about the Reserve Bank of Australia and fixed-rate home loans also spiked.

When it came to the hot topic of refinancing, search terms such as “borrowing capacity calculator” surged 5000 per cent, while fixed-rate home loan searches jumped 600 per cent, as interest rates increased to the highest level in a decade.

The analysis also found the top homeownership questions were, “How much can I borrow mortgage?”, as well as, “How to calculate mortgage?”, “What is a reverse mortgage?”, “How much deposit do I need for a home loan?” and “How much is lenders mortgage insurance?” 

Great Southern Bank Chief Customer Officer Megan Keleher said 2022 had been a tough year for Australian homeowners, having now faced their eighth consecutive interest rate rise, as well as for those trying to get into the market for the first time.

“Rising interest rates and the increased cost of living have been affecting household budgets and driven more customers to seek options to save on their home loans,” Ms Keleher said.

“They’re using the internet to find out how much they can borrow, how to refinance, and what support may be available for first-home buyers

According to Great Southern Bank, home buyers have used their refinance calculator nearly 4000 times in the past quarter, reflecting a quarterly spike of 16 per cent and leading to 10 per cent more funded applications.

Ms Keleher said using tools like a refinance calculator could help borrowers get a clear idea of their budget.

“We’ve seen a 16 per cent increase in people using our refinance calculator over the past three months,” she said.

“And our data shows that applicants who use a calculator when submitting their application are four times more likely to get their loan approved.

“Still, this is a complex area and DIY home loan research will only get you so far. 

“We’d encourage borrowers – and particularly first-time buyers – to talk to a broker or bank home loan specialist. 

“They can help look at affordability, budgeting, and help explain the government grants and refinancing offers that can cut years from a home loan.” 

According to Ms Keleher, despite high interest rates, there are still many active buyers in the current market.

“As this research reflects, we know that there are still first-home buyers in the market eager to achieve their home ownership goals,” she said.

“We’re seeing strong demand for government schemes, including the new Regional First Home Buyer Guarantee, giving much-needed help to first-home buyers outside of our capital cities where house prices are often more affordable. 

“Our home lending specialists have also been busy helping borrowers to refinance to Great Southern Bank, many of whom are coming off fixed rates and seeking what options are available to them as they look to refinance their next home loan.”

The top search terms about home ownership in 2022 were: 

  1. Interest rate rise – up 750 per cent YoY 
  2. RBA cash rate – up 500 per cent YoY 
  3. RBA interest rate – up 300 per cent YoY 
  4. Fixed rate home loans – up 150 per cent YoY 
  5. Fixed interest rate home loan – up 100 per cent YoY

The top search terms about refinancing in 2022 were: 

  1. Pay calculator – increased by more than 5000 per cent 
  2. Borrowing capacity calculator – up more than 5000 per cent
  3. Fixed rate home loans – up 600 per cent YoY
  4. Borrowing power calculator – up 190 per cent YoY
  5. LMI calculator – up 120 per cent YoY

The top home ownership questions in 2022 were: 

  1. How much can I borrow mortgage?
  2. How much can I borrow home loan?
  3. How to calculate mortgage?
  4. What is a reverse mortgage? 
  5. How much deposit do I need for a home loan? 
  6. How much is lenders mortgage insurance? 
  7. What is refinancing?
  8. How much is the first home buyers grant?

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Rowan Crosby

Rowan Crosby is a senior journalist at Elite Agent specialising in finance and real estate.

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