Seven in 10 Aussies are using the equity in their home to renovate their home or invest in property, while many have taken the opportunity to get ahead of their loan repayments, according to new research from National Australia Bank.
The latest NAB Housing Market Insights Report showed that many homeowners who have seen their home’s value increase in recent years are looking at ways to use this to their advantage.
Over four in 10 are grabbing the chance to get ahead on their loan by either making larger or more frequent repayments on their loan or making a lump sum payment if available, while around three in 10 Australians whose home needs a facelift are unlocking the useable equity and borrowing more to do renovations on their property.
Other ways Australians are using their home equity are through buying an investment property (16%), investing in shares (12%), or adding it to their super (8%).
The NAB report also showed that mortgage holders aged 18-44 are more likely to get ahead on their loan, compared with those over 45, while those aged 45-54 are more likely to invest in superannuation. Two in three Aussies aged 18-24 are paying down their loan compared to those between 25-44, who are more likely to renovate.
“Customers are wanting more security and certainty, so it is not surprising in this environment of rate increases that we are seeing, Aussies paying down their mortgages even further,” said Andy Kerr, NAB executive home ownership. “We’re fielding more enquiries today about how to use equity than we’ve ever seen. And as hybrid working continues to evolve, many Aussies are taking the opportunity to build a new study or finally get that dream kitchen.”
The NAB survey was conducted with 500 Australians and weighted to the population from April 26 to May 1.