New PEXA data records a 12 per cent surge in refinancing activity, igniting increased mortgage competition

Melbourne, Australia:  The latest Property and Mortgage Insights reports from PEXA, the world-leading econveyancing group, reveals a sharp increase in refinance volumes, indicating the return of ‘mortgage wars’ amid continued growth in property prices and sales volumes for the March 2025 quarter.

PEXA settlement data shows a 12.5 per cent increase in refinance volumes from the same period last year. This is the likely result of increased borrowing capacity and lenders’ incentives for home buyers in response to the Reserve Bank’s official cash rate cut in February.

In property, Australia’s five mainland states saw a total of 156,573 settlements with a total value of $158.5 billion in the quarter, an increase of 1.2 per cent in volume and a 5.3 per cent per cent increase in value from the same quarter last year. Of this, $140.7 billion was spent on residential property, a 6.4 per cent increase on prior year. When compared to five years ago, this amount represents a 56.1 per cent increase in residential property settlements since March 2020.

Demand for property in Queensland, Western Australia, and South Australia continued to remain strong. QLD recorded the highest number of settlements (43,530) but Victoria and SA recorded the highest growth in residential property sales (up 4.1 per cent and 4.3 per cent respectively) from same period last year. NSW and WA lagged behind the other states, both growing by less than 1 per cent. However, QLD, WA and SA recorded 12-15 per cent growth in the aggregate value spent on property compared to the same quarter last year.

Residential property prices continued to climb in the quarter, particularly in QLD, where median residential house prices have surged far beyond prices in its eastern counterparts. In Greater Brisbane, prices increased by 12.3 per cent on year prior and by 13.6 per cent in regional QLD.

In terms of top suburbs for residential settlements, in NSW, there was a mix of outer growth suburbs on the greater Sydney fringe, inner-city suburbs and regional towns Port Macquarie, Dubbo and Orange. In VIC, the list includes growth suburbs in Melbourne’s west, north and south-east; in QLD the Gold Coast and Sunshine Coast; while in WA, greater Perth is booming.

In the commercial property sector, VIC and QLD performed strongly with higher settlement volumes compared to the prior year, while in NSW the sector seemed sluggish, with commercial settlement volumes declining across the state. However, in value, NSW settled the largest amount on commercial property ($7.7 billion), followed by VIC ($5.6 billion) and QLD ($4.5 billion).

In mortgage trends, the number of home loans issued increased by 4.4 per cent to a total of 118,320 and a total value of $80.2 billion. Of these, $73.5 billion were for residential property which represents an increase of 8.2 per cent on the March quarter in the prior year.

Significantly, refinancing activity which had slowed in 2024, strongly picked up again the Mar-25 quarter, with 91,786 refinances settled – an increase of 12.5 per cent from the prior year.

PEXA Group’s chief economist Julie Toth said the reports show that the Reserve Bank’s February decision to cut official cash rates was already demonstrating a tangible impact on the Australian mortgage market.

“Growth in refinancing activity has been driven by the recent interest rate cut, which has increased borrowing capacity for prospective buyers, and resulted in lenders introducing incentives such as reduced fixed -rate loans and cash incentives for homebuyers, “Ms Toth said.

“We are continuing to see house price growth across the mainland states, and increasing demand for property in QLD, WA and SA. This cements a trend of buyer interest shifting away from NSW and VIC to the smaller capital cities, and the South-East QLD region in general.

“This increased popularity in QLD is also coming at a cost for first home buyers with median house prices increasing and the proportion of properties selling under $800,000 now in sharp decline.”

Ms Toth said the growth in Greater Perth is consistent with evidence that suggests investors have moved to the smaller, more affordable capital cities.

Property Insights Highlights

• Queensland dominated the property quarter this quarter, recording the highest number of settlements (45,530) and experiencing substantial price growth. The Gold Coast and Sunshine Coast were particularly active area, though the rising prices are increasingly challenging for first home buyers.
• Victoria emerged as a strong performer in the quarter, recording an impressive 4.1 per cent increase settlement volumes year-on-year. The state also demonstrated robust commercial property performance and saw significant activity in Melbourne’s growth corridors across the west, north and south-east regions.
• NSW’s property market appeared sluggish over the quarter, with residential settlement growth below 1 per cent and commercial settlement volumes declining.
• In Western Australia and South Australia demand for property continued to remain strong, with SA leading all mainland states with a 4.3 per cent growth in settlement volumes compared to the previous year. In WA, the aggregate value spent on property recorded double-digit growth, indicating a robust and growing market.

Mortgage Insights Highlights

•  119,491 new loans were settled in the Mar-25 quarter, 5.4% higher than the same period in the previous year.
• A total of $80.2 billion in new loans, of which $73.5 billion were for residential property, were settled in this quarter, an increase of 7.6% on the March quarter in the prior year.
• Refinancing activity, which had slowed in 2024, strongly picked up again in the Mar-25 Qtr, with 91,786 refinances settled, up 12.5% from the Mar-24 Qtr.

Full Property Insights report 

Full Mortgage Insights report

PEXA Group’s Chief Economist Julie Toth is available for interviews.  

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For more information, or to arrange an interview with Ms Toth, please contact: 

Liz Deegan 
Cato & Clive 
M: 0418 650 936 
 
About PEXA Group 

PEXA Group is a world-leading ASX-listed digital property exchange platform and property insights solutions business. The PEXA Group of companies, including: .id (Informed Decisions), Value Australia and Land Insight, also delivers a new generation of data solutions that empower businesses and governments to make more informed property and place-related decisions.

PEXA Exchange is the leading digital property settlements platform in Australia. PEXA is a licenced operator of Australia’s largest Electronic Lodgement Network (the PEXA Exchange). Since 2013, PEXA has facilitated more than 20 million property settlements through the PEXA Exchange in Australia, with 89% market reach, and in 2022, PEXA launched in the UK.