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Most Australians are likely to shop around for their next home loan or refinance deal, and are increasingly looking at other ways to do so, according to new research.
A survey commissioned by Aussie Home Loans revealed that 84 per cent of people who plan to take out a home loan or refinance in the next 12 months will ‘probably shop around’ for their home loan, while 66 per cent are ‘always on the lookout’ for a better deal.
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The research also revealed that borrowers are increasingly considering other ways to get a mortgage, with eight out of 10 respondents considering both banks and brokers, while 64 per cent of owner-occupiers favour using a broker.
Aussie CEO James Symond said the research clearly shows that the current historic low interest rates and hot competition amongst lenders are “spurring on” both new and existing borrowers to shop around.
“Borrowers are increasingly savvy about the need to get a second opinion when it comes to making possibly the biggest financial commitment of their lives, and I think this is a really positive trend in such a competitive market,” he said.
Despite refinancers and first home buyers being the most likely to shop around (87 per cent and 86 per cent respectively), the survey showed that refinancers feel significantly less confident to compare and select a home loan themselves (53 per cent) than FHBs (70 per cent).
Refinancers are also less likely to prefer a deal with banks than FHBs (59 per cent and 66 per cent respectively), and are less likely to believe that all home loan providers are the same (43 per cent compared to 57 per cent for FHBs).
The survey also revealed that social media has become a more popular research tool for borrowers, with the percentage of people asking advice from their online friends and followers increasing by seven per cent.
The number of borrowers seeking recommendations from family, friends and colleagues increased by five per cent.
“Unsurprisingly, first home buyers are the most savvy when it comes to seeking recommendations from their social networks both on and offline,” Mr Symond said.
“While it shouldn’t replace getting expert home loan advice, one person’s good experience is a positive indicator for someone who’s shopping around, so I’m not surprised to see social referrals on the rise.”
[Related: FHBs suffering greater mortgage stress]
