Home owners are celebrating the official cash rate staying on hold for several months. But behind the scenes, Mozo reports that lenders have been “astonishingly busy” adjusting their home loan rates – both up and down.
Key movements over the last month include NAB, CommBank and Bank of Queensland lifting some of their variable rates.
However, in the fixed rate market, plenty of lenders including big banks such as CommBank, ING and Macquarie have slashed their fixed rates.
It goes to show, you can’t assume your home loan still offers a competitive rate just because the official cash rate hasn’t budged.
Question is, how does your loan shape up against the market?
Across owner-occupied home loans, the average variable rate right now is 6.60%.
Remember though, this is an average. It can be possible to pay far less.
We are still seeing home loan rates starting with a ‘5’ rather than a ‘6’. This makes it worth checking to see what you’re currently paying.
As of early September, fixed rates are averaging:
– 6.36% – one year
– 6.57% – two years
– 6.60% – three years
If you’re bold enough to fix for five years, the average rate is currently 6.49%.
These fixed rates assume a $400,000 loan with a 20% deposit, meaning a loan-to-value ratio (LVR) of 80%.
It’s the question everyone is asking: when will interest rates start to fall?
First the good news.
A number of banks, including ANZ and Westpac, are tipping the cash rate has peaked and could stay the same for some time.
Westpac thinks we could see the cash rate fall by September 2024. AMP meanwhile is forecasting rate cuts even sooner.
But … not everyone agrees.
NAB economists expect one more rate hike before the end of 2023, with rates likely to fall by next Spring.
And the Reserve Bank of Australia (RBA), which makes the official rate calls, is warning we could see more rate hikes depending on how inflation and the economy are tracking.
Even the experts can’t agree on where rates are heading.
But the banks aren’t waiting around for the RBA to drive their rate decisions, and neither should you.
Call us today to see how your home loan rate compares to the broader market. Chances are there’s a better deal out there just waiting to be claimed.
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Paul da Silva
Director & Senior Mortgage Advisor
