Two-thirds of borrowers to look beyond big four banks for mortgages: Citibank

Nearly two-thirds (65%) of Australians will consider an alternative mortgage lender to the major banks this year, according to the 2012 Citi Fin-Q Survey.

The same percentage of respondents say there is not enough competition in mortgage lending.

The results were based on online interviews with 500 participants in Australia carried out in December 2011, during a time when variable interest rates were falling.

The survey also found a high level of negative sentiment about the mortgage market, with 70% saying the government needs to do more to help first-time buyers and 63% saying they don’t believe home ownership will be an option for the next generation of Australians.

Vibha Coburn, director of Citibank Mortgages, says the findings point to a trend of Australians looking at all their options when choosing a home loan.

“Despite the doom and gloom from our survey respondents, I believe the fact that Australians will look at mortgage providers outside the big four when choosing their home loan is a positive sign,” she says.

“Regardless of which home loan you choose, the best thing you can do is to conduct your own research and compare a range of products and lenders to find the most suitable solution for your needs.”

The survey also found that more than one in ten (11%) people have moved or downsized in the last 12 months to lower their costs and nearly two-thirds (62%) have indicated that home ownership is so expensive, they’ve adjusted their expectations about what their dream home might look like.

“At Citibank, we’re seeing a trend where customers might sacrifice the size of a property to live in a particular location or vice versa.

“This could mark a return to eras gone by when first-home buyers bought an entry-level property with the aim of upgrading to another larger property, or a property in another area,” Coburn says.

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