A new research showed that property owners are unlocking the equity in their homes for a range of reasons but with the same end goal: financial security and certainty.
According to the latest NAB Housing Market Insights Report, many home owners who have seen an increase in the value of their homes in recent years are looking at ways to leverage the equity their property holds.
The survey, which was conducted from 26 April to 1 May this year, also showed how different age groups use their equity and where their priorities lie.
For most of the people surveyed, getting ahead of their loans was the number one priority. Data showed that four in 10 out of the 500 Australian adults surveyed had grabbed the chance to get further ahead on their loan by making larger or more frequent repayments.
Interestingly, data showed that mortgage holders aged 18 to 44 are more likely to take the chance to chip away at their debt early, compared with those who are aged over 45.
Meanwhile, data showed that three in 10 Aussies whose property needs a facelift have put renovations on the agenda and are unlocking the usable equity and borrowing more to make the changes.
The report also revealed that Millennial mortgage holders aged 25 to 44 are more likely to use their equity to renovate compared to other age groups.
Buying an investment property (16 per cent), investing in shares (12 per cent) or adding it to their super (8 per cent) are other ways Australians are using their home equity to get ahead.
The NAB report revealed that those aged 45 to 54 tended to invest in superannuation.
NAB executive, home ownership, Andy Kerr said that with many NAB customers ahead on their loans, it was interesting to see them utilising their equity to get further ahead.
“We’re fielding more enquiries today about how to use equity than we’ve ever seen,” he commented.
“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.”
He added that as the norm for work set-ups continues to change, there will be more Aussies who will catch the renovation bug.
“As hybrid working continues to evolve, many Aussies are taking the opportunity to build a new study or finally get that dream kitchen,” he surmised.