The Your Mortgage survey questioned 1,049 Australian home loan holders about their mortgages in late 2024 when the average variable interest rate remained stalled at its most recent peak of 6.30% p.a.
The period from 2022-23 saw the steepest rise in the cash rate in Australia's history, with a hike from 0.1% to 4.35% over an 18-month period.
Perhaps not surprisingly, of the Australian mortgage holders with home loan regrets, 28% said their greatest regret was not preparing for the interest rate increases.
The second most common (23%) was not locking into a fixed interest rate during the period, closely followed by not locking in for a longer fixed term (21%).
Borrowing timeline differences
These regrets were most common among people who'd taken out their loans between 2016-20 when interest rates were at historic lows.
Borrowers who'd taken out loans in 2021 or later had other regrets, including having too small a deposit (19%) or borrowing too much (17%).
This likely reflects buying at a time when home prices were on the rise with rates remaining low until the RBA began its hiking cycle in May 2022.
For borrowers who signed up to earlier home loans between 2006 and 2010, their biggest regrets shifted to their choice of lender (19%) and choosing to extend the term of their home loan (15%) instead of paying it off sooner.
Pays to know your interest rate
The survey also found 40% of mortgage holders were unaware of their current interest rate.
Your Mortgage editor Brooke Cooper said this knowledge appeared to correlate with better financial literacy and greater confidence in navigating financial strain.
"Even though borrowers from both camps were equally impacted by the high-rate environment, those who knew their interest rate were more informed about refinancing options or taking other proactive steps, such as negotiating better terms or switching lenders," Ms Cooper said.
Brooke Cooper, Editor of Your Mortgage
The survey found of borrowers who knew their interest rate:
- 22% used an offset account more compared to 14.5% of those who didn't know their rate
- 17.6% made extra loan repayments compared to 12.4% who were unaware of their rate
- 15.2% refinanced to a lower rate, compared to 13.5% of those unaware
- 8% adjusted their payment frequency, compared to 3.9% of those unaware
- 7.7% switched their interest rate type (from variable to fixed or vice versa), compared to 4.3% of unaware borrowers.
Overall, borrowers who didn't know their rate were more likely to report making no changes to their home loan in response to rising rates (54.3% compared to 42.8% of aware borrowers).
They were also more likely to apply for financial hardship assistance (4.3% to 2.6%).
Gen Z the next generation of landlords
One surprise from the data was that Gen Z respondents (those born 1997-2012) edged out Baby Boomers in reporting their most recent home loan was an investment loan (17% to 14%).
It suggests a shift towards the trend of rentvesting (buying a more affordable investment property while renting elsewhere) or nestvesting (buying an investment property while living at home with parents).
The generational difference with Baby Boomers is, not surprisingly, in the number of investment properties owned.
Of Gen Zs taking out investment loans, 54% owned one property compared to just 7% of Baby Boomers - 80% of which had either two or three investment properties.
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Buying an investment property or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for investors.
| Lender | Home Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Repayment type | Rate Type | Offset | Redraw | Ongoing Fees | Upfront Fees | Max LVR | Lump Sum Repayment | Additional Repayments | Split Loan Option | Tags | Features | Link | Compare | Promoted Product | Disclosure |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
6.19% p.a. | 6.53% p.a. | $3,059 | Principal & Interest | Variable | $0 | $530 | 90% | 90% LVR |
| Disclosure | ||||||||||
6.24% p.a. | 6.26% p.a. | $3,075 | Principal & Interest | Variable | $0 | $250 | 60% |
| Promoted | Disclosure | ||||||||||
6.29% p.a. | 6.20% p.a. | $3,092 | Principal & Interest | Variable | $0 | $0 | 80% | Apply in minutes |
| Promoted | Disclosure | |||||||||
6.34% p.a. | 6.38% p.a. | $3,108 | Principal & Interest | Variable | $0 | $530 | 90% |
| Promoted | Disclosure | ||||||||||
6.34% p.a. | 6.36% p.a. | $3,108 | Principal & Interest | Variable | $0 | $350 | 60% | Disclosure |
Image by Andrea Piacquadio via Pexels
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