Refinancing a home loan can be a smart financial move, helping you secure a better interest rate, reduce monthly repayments, or access equity for other investments. With changing market conditions and competitive lender offers, now might be the perfect time to review your mortgage and explore refinancing options that suit your financial goals.
After a break, I am feeling refreshed and have written a few long-form articles (self indulgent I may have been 🙏).
One blog is on the post-Covid property market (resi and commercial) using data which has often not been quoted in the mainstream media. The other blog is on Renewables and the continued growth you don’t always hear about. They are not intended to be thorough analyses but again, they pick up comments I am seeing in my news feed which I reckon make sense. Enjoy – or avoid!
Plus of course, we have our usual review of the best interest rates and some other very useful articles on property and finance.
- Best interest rates
- Quick guide to first home buyer incentives
- The six key factors which help suburb prices increase
- Adelaide – the next big thing
- The property sky – is it falling?
- A free car buying service – the smart way to buy a car
- Technology and renewables – they are just starting to ramp up
- The case for and against rate cuts
- How to buy your dream home in 2025
- How to know if it’s time to refinance
Read more below.
PS Did you know….
After rising for 22 consecutive months, the national median property price fell in December, signalling a potential shift in market conditions.
Best Rates
Interest rates below as at: 1 Feb 2025
This could (hopefully 🙏) be out of date within a few weeks!
Interestingly, there has been a slight downward movement in all rates over the past few months so watch out if the Reserve Bank of Australia (RBA) steps in and announces a reduction in the cash rate. (For the nerds, the cash rate is the interest rate that banks pay to borrow money from other banks overnight).
Please note: these rates exclude clean energy rates, first home buyer rates and packages and construction loan rates and an Offset feature (where applicable).
Owner Occupiers
Principal and Interest
- Fixed Rates: from 5.55% pa – 2 and 3 year terms
- Variable Rates: from 5.78% pa (excluding ‘clean energy’ loans)
Interest Only
- Fixed Rates: from 5.85% pa – 2 and 3 year terms
- Variable Rates: from 6.39% pa
Investors
Principal & Interest
- Fixed Rates: from 5.69% pa – 2 and 3 year terms
- Variable Rates: from 6.18% pa
Interest Only
- Fixed Rates: from 5.85% pa – 2 and 3 year terms
- Variable Rates: from 6.34% pa
Quick Guide To First Home Buyer Incentives
First Home Buyer Assistance Explained
As a first home buyer, you have access to various government assistance schemes to help you purchase your property
State and Territory Grants
Most states and territories (excluding the ACT) offer grants for first home buyers, ranging from $10,000 in several states to up to $50,000 in the Northern Territory. These grants are available to owner-occupiers and may apply to both new and established homes, depending on your location. Income and property price caps may also affect eligibility.
Stamp Duty Concessions
With the exception of the Northern Territory, all states and territories provide stamp duty concessions for first home buyers. These concessions range from complete exemptions to partial discounts, depending on where you purchase and specific conditions.
Federal Government Schemes
Additionally, the federal government offers several assistance schemes tailored for first home buyers.
Under the First Home Guarantee and Regional First Home Buyer Guarantee, eligible first home buyers can enter the market with just a 5% deposit, without having to pay lenders mortgage insurance. Income and property price caps apply
Also, another scheme, called Help to Buy, is expected to go live later this year. Help to Buy is a shared-equity scheme in which the government will acquire a stake of up to 40% for a new home and up to 30% for an established home, thereby reducing the buyer’s contribution to as little as 60-70% of the purchase price.
Click on the official websites below for more information.
The six key factors which help suburb prices increase
Courtesy of Live Wire Markets, I have summarised an interesting article from their Blog. To get the full article, you can click here: six key factors which help suburb prices increase
1. Population Growth and Demographics
Strong population growth is a reliable indicator of suburb potential. Cities like Brisbane, Perth, Sunshine Coast, and Gold Coast saw significant price rises due to migration. Look beyond headline growth to understand demographic shifts and potential land releases affecting demand.
2. Infrastructure Development
Investment in infrastructure—new highways, railways, or commercial hubs—boosts connectivity and attracts buyers. Check government plans and local announcements to spot upcoming hotspots, like suburbs near new transport links.
3. Tight Rental Markets
Suburbs with low vacancy rates offer strong investment potential. Coastal and lifestyle areas continue to experience high demand post-COVID. Use data from CoreLogic, SQM Research, or REA and Domain to identify tight rental markets.
4. Economic Diversification
Suburbs reliant on multiple industries (education, health, technology) are more stable than those dependent on one sector (e.g., mining towns). Review city plans for new developments that signal long-term growth potential.
5. Gentrification and Lifestyle Appeal
Areas like Northcote and Thornbury in Melbourne exemplify gentrification’s impact on property values. Lifestyle factors, especially proximity to water, drive demand in suburbs like Gold Coast.
6. Identifying ‘Forever Suburbs’
Some suburbs attract high-income earners due to unique appeal—top schools, proximity to CBD, or vibrant culture. These “forever suburbs” see low turnover and strong long-term price appreciation.
Tip: use a buyer advocate to do the hard research yards.
Some of you have the expertise and experience to research the above data trends, but for some of you, it might be overwhelming.
If that is the case, consider using a buyer or property investment advisor advocate.
As a subscriber to our newsletter, you have access to our in-house Property Concierge service run by Trish Moore, Hidden Gems Property Scouts which is a free service. Just email me and I can put you in touch with Trish.
And if you want the details of some of the advocates other than Trisk, including the good folk at Performance Property, just ask me, and I will be happy to make an introduction or give you a shortlist for your consideration.
Please note: we do not earn any fees or commissions from these referrals unless otherwise advised to you in writing.
Adelaide - the next big thing
Photo credits to: https://www.greenadelaide.sa.gov.au/projects/adelaide-national-park-city
A good segue from the above article is this article on Adelaide.
Plus, two of my favourite sources of regular data, Property Share Market Economics (PSME) and its irreverent guru, Phil Anderson, and the local Buyer Advocate and research house, Performance Property (PP), are both bullish on Adelaide.
Phil goes for the macro view – AUKUS and the growth of infrastructure and jobs in the Adelaide region (located north of the existing shipyard on the Lefevre Peninsula). Performance Property looks at current data trends – low vacancies, rising rents and the lack of affordability in the other major capital cities.
And, both sources use the Six Factors. So, there you go.
If you want to know about PSME or PP, drop me a line and I can give you someone to talk to. They aren’t free services but they are highly educational and always have relevant information for those who want to stay informed and invest in the property and share markets.
The property sky - is it falling?
Well, if you believe the ABS, not this year at least. I won’t be a predictionist (a new word for 2025) but I can say that the case for properties to fall this year is remote – but as Phil Anderson would be saying ‘watch out for 2026 and the peak of the next 18.6 year cycle’).
Below is a snapshot of the history of property prices
Courtesy of Michael Yardney’s Property Update emails. If only we could align this graph with the market’s predictions! at the start of each year!
As humans, the predictive capabilities of the herd is generally pretty poor. Hence, the expression, when the taxi driver (remember those?) says ‘buy shares’ you know it’s time to sell.
It also reminds me of the predictions of the world’s most knowledgeable in the area of renewable expansions across the world. Each year they projected a leveling of growth and each year the growth has continued exponentially. No wonder Governments find it so easy to debunk the transition to renewables when the experts can never get the predictions right.
And to finish this off, we cannot exclude the influence of our mainstream media gurus. Just recently, to spread the fear, Sky News ran an article under the headline, “Property prices continue to plunge in Melbourne, Sydney over January as national average stalls following December drop“. Which reminds me of Warren Buffet’s pithy quote: “Be fearful when others are greedy, and be greedy when others are fearful.”
But, there has been a post-Covid property crunch
Do you remember Covid and the emptying out of the capital cities – particularly Melbourne with its most restrictive lockdowns?
A couple of things happened:
#1 Regional Property Prices boomed
Many Melbourne residents looked to transition to working from home in an idyllic location. This trend has since reversed with property prices falling quite dramatically in many tourist hotspots. See Domain’s graph below for Victorian coastal towns which I have extrapolated and expanded. It says it all. [Note to self: there might be some opportunities in these markets to buy low!]
#2 Commercial Properties did not take a hit – at the time….
Whilst there were no workers in the buildings, the commercial agreements between landlords and tenants meant that the immediate impact of Covid on commercial properties was not felt as severely at that time.
However, with the CBD recovering slowly and many workers preferring to work at least partially from home, CBD commercial property is now taking a hit, particularly when leases are up for renewal. In some cases, the hit is resulting in prices at what could only be called a distressed pricing level.
Performance Property identified that larger property funds and Real Estate Investment Trusts (REITS) are currently seeking to exit some of these under-performing properties, with discounted valuations, particularly for underutilised or vacant sites. Office buildings with significant short-term capital expenditure requirements or heavy incentives needed to attract new tenants are also struggling.
A couple of things are at play, particularly, I suspect, in Melbourne.
Whilst the economic conditions, interest rates and Victorian land taxes have all played a role in driving the desire to sell – almost at any price, there may be a couple of other factors at play:
i) Profitability can be key
Most of these investment-grade investment vehicles would, I suspect, prefer a short-term boost to profitability and return on investment in the next year or so which will come with a once-off capital loss caused by the sale of what is currently an unprofitable property.
And for the cynical amongst you, from an employee bonus perspective, a hit for one year followed by a bounce-back is preferable to ongoing depressed earnings and an uncertain future.
ii) Portfolio approach favours exits
Most asset-acquiring businesses use a portfolio approach to their businesses. In other words, they expect a few duds, a lot in the middle of the road and a few stars.
They might feel it is better to exit the duds rather than invest in hiriing in the expertise they don’t have (and perhaps invest the time they don’t have) to resurrect the value of the dud building.
This factor, together with the focus on short-term profitability, means it is easier to exit and sell a dud property rather than try to turn around its performance – where there are no guarantees as to the timeframe or the result.
iii) Lenders’ opinions count
Lenders like cash to repay debt and interest. And, they are not in the business of waiting to get cash from borrowers (note to home owners: home loans have the same rules!). As one banker said to me once, ‘We don’t get an equity return from our loan so we need the cash as promised’.
Drawing from my previous experience in insolvency and restructuring, if a property owner is over-leveraged (i.e. too much debt to service the interest repayments from cashflow), their lender is likely to ‘strongly encourage’ a reduction in debt levels so short-term serviceability improves and the loan can continue to be repaid.
A case in point: I remember a commercial building and an adjacent car park near Central Station in Sydney being forcefully sold by Westpac in the early 1990s (when it too was in a financial downward spiral and its share price fell to around 30 cents!). Within a couple of years, the buyer sold the car park for the price they paid for both properties and was left with a debt-free commercial building full of tenants – not a bad investment!
Technology and renewables - they are just starting to ramp up
AI is on the move.
Personally, I love AI for work but I am as scared as s#@t as to where it will all go. I remember the Terminator series of movies too well.
What we have seen in recent news:
DeepSeek is the new AI kid on the block – and it is Chinese
Yep, the Chinese with their huge number of engineering graduates (the number is colossal – 1.6 MILLION graduates in 2022 – the largest in the world as they target STEM education and vocational training), has worked out a way to do what ChatGPT and others have achieved with a fraction of the money and processing power (and even if this part is hyperbole, it is still impressive).
What this did was scare investors away from Nvidia, which produces the processing power for the Western world’s systems. And, the ramifications will continue.
Renewables are just starting to get a move on
Renewables are pro-business (and farming)
I have to say, I don’t get the conservatives’ attitudes on renewables (unless their spokespeople have way too much fossil fuel and nuclear shares in their investment portfolios).
For starters, renewables are pro-business – lots of new businesses are springing up (both big and small) with lots of new technology and ideas. And, they employ lots of people. Yes, wind and solar farms are not nearly as attractive as green fields but then, a smoke-belching coal plant is not that nice in your backyard either. Just saying.
A bit of a segue at this point to agrivoltaics – farmers who are part of a movement that has figured out that solar panels provide much-needed shade and shelter for their livestock (particularly sheep), while they also make money from the solar panels. Again, just saying.
Nuclear is, well…..
And nuclear – if only the promises for cost-efficient plants were being replicated elsewhere, then it might be an option. But personally, I am not keen on nuclear waste near me so that’s enough to turn me off. (And I don’t like the thought of micro-plastic in my bloodstream either so I can be a bit of a hypocrite).
But, and it is a big but, it seems a lot of the nuclear ventures are not actually getting developed for the quoted cost or the quoted timeframe. Sounds like a Government funded project which is being run by private enterprise….
The renewables growth path
The other thing I don’t get is the negativity on the growth path of renewables.
More on this below.
Renewables remind me of computers
From what I can see, renewables are a bit like the early stages of computers – but on steroids.
A history lesson on computers first: The first generation of computers, spanning the 1940s to the 1950s, covered vacuum tube-based machines. The second generation (1950s to 1960s) progressed to incorporate transistor-based computing. In the 60s and 70s, the third generation gave rise to integrated circuit-based computing.
That’s 30 years and we were only just getting to the Commodore 64! And laptops only became the major hardware sold (compared to desktops) in 2005 – so that’s around 65 years after the concept of commercialising computers was first considered (albeit, it was thought by one of the developers that there would only be one in the world!). And 2005 is just 20 years ago….
What happened to enable this incredible growth in computers?
– Technology exponentially improved quality, reduced size and increased capacity and reduced costs
– New uses were found and new applications were developed. I remember my firstsmartphone decision: ‘Do I really need this? After all, I don’t play games all day long’).
The growth of renewables.
According to Dr Google, the first household solar panels were sold in Australia to Peter Fries in 1994 in Mount Coolum, QLD.
Now, 30 years later, around 4 million homes (or 37%) have solar panels – and given the results from a business colleague of mine who sells solar panels across Australia, this number is still rapidly increasing (and he has a great business!
And if you would like an intro to this owner, Jatin Bhalani who runs 85 Energy, let me know – in 10 minutes jatin gave me a quote for solar on our rooftop together with modelling based upon Google maps and our current electricity bill – almost as amazing as solar panels themselves! Or, you can visit his business here: www.85energy.com.au
And now we move on to household batteries which I first remember being spruiked by someone who was my good friend, Elon Musk. These were introduced to us in the mid-teens – just 10 years ago.
And, guess what is happening with renewables?
– The costs keep coming down, the quality keeps going up, the R&D keeps developing new options, and the world is rapidly changing over – still with double-digit growth.
An article in Renew Economy quotes a modelist, Andrew Birch, who uses a model which reminds me of the exponential progress of computer technology – both hardware and software.
His model projects forward using the historical trends: costs will continue to fall by 10% per year, and growth will continue at 25% per year.
Andrew states that most modelling makes three pretty basic mistakes (call this the psyche mistake of humans when projecting forward into the unknown):
– Solar cost reductions are suddenly going to stop – but with no logic to support this conclusion.
– The market growth of 25% pa will suddenly slow down/end. Again, without any logic to support this.
– The amount of energy we need to run our economy won’t get any more efficient; even though over half of our fossil fuel energy is wasted when we burn it in our homes, cars and power plants
He calls his model the S Curve of growth. By 2036, under this model, solar will supply 50% of the world’s energy needs. Add in the other renewables which are also growing, and all this talk about needing nuclear just seems surreal.
Now, I could quote quite a few other articles I have read recently but two recently caught my eye. In China and the Middle East, there are some truly mega solar farm developments which are progressing to installation.
This growth in renewables is not slowing down anytime soon.
A free car buying service - the smart way to buy a car
I don’t know about you, but buying a car is problematic at best.
It is time-consuming trying to find the right vehicle, which may not even be in stock, then negotiating a good price. This can be an ‘interesting experience’, but this experience can quickly turn sour once you have spent more than a few hours going back and forth from dealer to dealer.
We have set up a relationship with a car-buying service operator – for both new and used cars Australia-wide.
Run by Simon Reid, this car-buying service is a nifty idea, and the good thing is that Simon puts his clients first. You can find out a little bit more about Simon via his LinkedIn profile: Simon Reid
The second good thing is there is no charge to you.
Simon earns his keep from the dealer, so the price you pay is ‘all-inclusive’. So, if he can get you a good deal for the car you want, then it can save you time, money and stress.
And, we don’t financially benefit from this service so for us, it is all about making life easier for you.
Just ring me or shoot me an SMS if you need to find a car ‘now’!
What To Expect From Interest Rates This Year
Interest Rates: Will They Fall by the End of the Year?
There’s a good chance that interest rates will be lower at the end of this year compared to the start, but this isn’t guaranteed.
The Case for a Rate Cut
The argument for a rate cut is strong. All four major banks believe the Reserve Bank of Australia (RBA) will reduce the cash rate multiple times throughout the year, starting in the first half.
Additionally, the inflation rate fell within the RBA’s target range of 2-3% late last year, which is a positive sign.
The Case Against a Rate Cut
However, there are strong reasons to be cautious.
While the official inflation rate is within the 2-3% target, the underlying inflation rate – which excludes volatile items and is considered more accurate by the RBA – remains above 3% and is deemed “too high”.
The RBA board has made it clear that it is “resolute in its determination to return inflation to target” and will take necessary steps, including keeping rates higher for longer.
They also believe it will take some time before inflation is sustainably within the target range.
The direction of interest rates in 2025 will largely depend on two factors: the outlook for inflation and the RBA board’s policy approach.
If the board focuses on bringing inflation down, it may delay any rate cuts until there is clear evidence that inflation is sustainably within the target band. This could take longer than expected and might not happen this year.
On the other hand, if the board aims to balance reducing inflation with supporting economic growth, it could decide to cut rates sooner.
Tips For Buying A Property In 2025
Pre-approval
Before you start your property search, it’s wise to secure a home loan pre-approval.
With the current interest rate and inflation challenges, some buyers may find their borrowing power is lower than in previous years. Having pre-approval gives you a clear idea of the maximum amount you can borrow and the price range you can afford.
Boost your Deposit
In the meantime, look for ways to boost your savings. You can reduce discretionary spending or increase your income by asking for a raise, working more hours, or even starting a side hustle. When you apply for pre-approval, this shows lenders you have a higher capacity to repay a loan, which could increase your borrowing potential.
Book a Discovery Call
In our Discovery Call, you will find out:
- How much you can borrow based upon your current circumstances (primarily your income, savings, liabilities and family structure).
- Who is likely to lend to you (which lenders are likely to say ‘Yes’.
- The lender products which are available from these lenders which meet your requirements and the cost of these products per month and the first two years as well as for the term of the loan. We like to look at the cost for the first two years as we believe you should be checking your lender’s best deal for you against what is available in the market.
I also recommend you order a free copy of your credit report, from Equifax, Illion or Experian, and look for errors. If you find any, contact the offending credit provider and ask them to fix the mistakes. Otherwise, they may unfairly drag down your credit score.
When you do start looking for a property, take the time to understand local market conditions. If prices are rising, that means buyer competition will be quite strong, which will limit your negotiating power. But if prices are falling – as they currently are in many markets – you may be able to drive a harder bargain with vendors.
How To Know If It's Time To Refinance
You should seriously think about refinancing if it’s been several years since you took out your home loan, based on the Home Loan Price Enquiry conducted by the Australian Competition and Consumer Commission (ACCC).
That’s because, after comparing existing borrowers with new borrowers, the ACCC found:
- Borrowers with home loans between three and five years old had an interest rate that was, on average, 0.58 percentage points higher than the average rate for new loans.
- Borrowers with home loans between five and ten years old had a rate that was 0.71 percentage points higher.
Lenders have to fight fiercely for new customers, so they tend to offer them better deals; they also know existing customers are often too busy to think about switching loans, so they may feel they can get away with charging them higher rates.
You should also consider refinancing if:
- Your financial position has changed since you took out your mortgage – you may be able to access a loan structure that is more suitable to your new position.
- You’ve built up equity in your property – you may be able to qualify for a loan with a lower interest rate if your equity position has increased since you took out the mortgage.
- Your fixed-rate period is expiring – you may be able to get a better deal by refinancing to a new lender than by reverting to your existing lender’s standard variable rate.
Contact us if you want to more!
