Every few years, something shifts in the Australian mortgage market that changes the calculation for homeowners. Right now, we’re in one of those moments.
In 2025, a record 640,137 Australian mortgages were refinanced a 20% jump from the previous year, according to the ABS. For the first time in Australia’s history, refinancing activity actually exceeded new home lending: 618,966 refinances compared to 537,326 new loans in the year to September 2025.
That’s not a coincidence or a blip. It’s the result of a specific set of conditions that are making it more worthwhile than ever for Australian homeowners to review their existing loans.
But here’s the part that gets overlooked: the majority of people who could benefit from refinancing haven’t done it yet. Understanding why the market shifted — and what that means specifically for your situation — is the real starting point.
The Rate Environment That Changed Everything
After the RBA cash rate peaked at 4.35% in late 2024 a 13-year high the central bank began cutting rates through 2025. The cash rate now sits at 3.85%, with major banks forecasting it could fall further. Average variable rates for owner-occupiers have come down accordingly, sitting around 5.5% as of late 2025 according to RBA data.
For anyone who took out a loan during the rate-hiking cycle of 2022–2024, this matters a great deal. The loan terms that made sense when rates were rising may now be significantly less competitive than what’s available today.
This is what’s driving the surge in refinancing not a sudden shift in people’s priorities, but a gap opening up between what existing borrowers are paying and what new borrowers can access.
What’s Actually at Stake — in Real Numbers
The average refinancing home loan in Australia is now $542,856, according to ABS data from September 2025. On a loan of that size, even a modest rate improvement can translate to meaningful savings over time.
To illustrate the kind of difference involved: refinancing from 5.90% to 5.40% on a $600,000 loan over a 30-year term could save approximately $296 per month. Individual outcomes will vary based on your loan size, remaining term, and the specific rates available to you.
The break-even point (the point at which your refinancing costs are recovered by the savings) typically arrives within 6 to 12 months. After that, the savings are ongoing.
The Equity Advantage Most Homeowners Don’t Realise They Have
Here’s something that surprises many people: the average owner-occupier refinancing in Australia currently holds over 50% equity in their property, according to Money.com.au research.
Australian dwelling values rose an estimated 8.6% through 2025. If you’ve owned your home for several years and haven’t had a formal valuation recently, there’s a reasonable chance your equity position is better than you think.
This matters because lenders use your Loan-to-Value Ratio (LVR) (the size of your loan as a percentage of your property’s current value) to determine your interest rate. A lower LVR typically qualifies you for sharper pricing. A property that’s grown in value since you bought it may open the door to rates you wouldn’t have been eligible for previously.
Why Working With an Oxygen Broker Changes the Picture
When you approach your own bank about refinancing, you’re seeing one set of options. When you work with an Oxygen mortgage broker, you’re accessing a panel of lenders. Around 63% of people who refinance do so with a different lender because that’s often where the most competitive deals are found.
A broker’s role is to assess your situation, compare what’s genuinely available across the market, and guide you through the process. They handle the comparison work, the applications, and the coordination so you don’t have to manage it all yourself.
If the numbers in this article have made you curious about where you stand, our refinance guide is a good next step. It walks through the key factors to review, the costs involved, and how to know whether the timing is right for your circumstances.
👉 Download our free Refinance Guide → oxygen.com.au | Call Oxygen Home Loans: 1300 855 699
⚠ Disclaimer: This information is general in nature. Please seek independent financial advice suited to your personal circumstances.
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