Remortgage demand will likely increase in the US, which could lead to affordable mortgage rates in the coming months.
According to a report, many lenders are raising their standard variable rates (SVR), leading homeowners who shifted to their lender’s SVR to make a new deal rather than face rising interest rates.
Banks are expected to capitalise on the increase and the added influx of borrowers. However, once the additional remortgage deals are completed, demand is expected to fall.
This could trigger another competitive lending market in the housing sector, similar to the trend seen in the second half of 2011, when homeowners were not opting to remortgage after warnings of an interest rate hike declined.
This resulted in many lenders offering attractive mortgage packages like good incentives and lower interest rates.
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