{"id":81577,"date":"2025-01-10T18:31:48","date_gmt":"2025-01-10T10:31:48","guid":{"rendered":"https:\/\/www.99.co\/singapore\/insider\/?p=81577"},"modified":"2025-01-10T18:31:51","modified_gmt":"2025-01-10T10:31:51","slug":"rate-cuts-increase-mortgage-refinancing","status":"publish","type":"post","link":"https:\/\/www.99.co\/singapore\/insider\/rate-cuts-increase-mortgage-refinancing\/","title":{"rendered":"Rate cuts in 2024 significantly spurred mortgage refinancing – Should you refinance now?"},"content":{"rendered":"
<\/div>\n

In 2024, mortgage<\/a> refinancing activity in Singapore saw a significant uptick as fixed mortgage rates dipped below 3% after the second quarter. Both private homeowners and HDB flat owners actively pursued refinancing and repricing options, capitalising on the favourable interest rate created by consecutive rate cuts from the US Federal Reserve starting in September<\/a>.<\/p>\n\n\n\n

Refinancing typically involves obtaining a new loan from a different bank after the lock-in period of an existing loan ends. In contrast, home loan repricing<\/a> refers to switching to a different loan package within the same bank once the lock-in period expires. These options gained popularity among borrowers seeking to reduce their financial commitments.<\/p>\n\n\n\n

Home loan refinancing transactions surged in 2024<\/h2>\n\n\n\n

UOB reported an 85% increase in HDB loan refinancing transactions in 2024 compared to the previous year. From June to November 2024 alone, the bank observed a 60% year-on-year rise in such activities. For private residential loans, refinancing transactions increased by nearly 15% during the same period.<\/p>\n\n\n\n

Similarly, DBS experienced a surge in applications for fixed-rate home loan<\/a> packages, particularly for one- to three-year options ranging from 2.6% to 2.9%. A sharp rise in activity occurred between September and November 2024 as borrowers moved away from floating rates, which remained higher than fixed-rate offerings. This trend marked a shift from the customers’ cautious approach observed earlier in the year.<\/p>\n\n\n\n

Further driving this momentum, DBS\u2019 POSB HDB home loan experienced a 70% jump in monthly new bookings during October and November 2024. This followed the bank\u2019s introduction of three- to five-year fixed-rate packages with rates as low as 2.5%.<\/p>\n\n\n

Use 99.co property mortgage calculator<\/a> to get a glimpse of what your mortgage repayments should be!<\/em><\/p>\n\n\n

Competitive mortgage rates for home loans<\/h2>\n\n\n\n

Financial institutions played a pivotal role in boosting refinancing activity by offering competitive packages and attractive perks. Some banks introduced five-year fixed-rate packages at 2.5%, which fell below the HDB concessionary interest rate of 2.6%<\/a>. <\/p>\n\n\n\n

These offerings appealed to homeowners anticipating further rate cuts. Many viewed refinancing as a strategic move, confident that additional reductions in interest rates would present future opportunities to refinance again.<\/p>\n\n\n\n