The Variable Mortgage interest rates have gone down to 2.89%, this is in line with the monetary policy adjustments of the RBA (Reserve Bank of Australia).
Canstar, a research and expert ratings agency in Australia, have presented a snapshot of the mortgage rate environment in compliance with the RBA’s consecutive adjustments with their monetary policy which predicted that cash rate fall by a total of 50 basis point to a new record low of 1%.
RBA’s main objective why they need to have a back to back cut rates is to encourage the labour market, stating that lower rates could help support the needed growth in employment. The mortgage market promptly responded to the cut rates as they have already implemented it to their home loan clients.
The analysis of Canstar has found out that due to the effect of cut rates, the average variable owner-occupied principal and interest mortgage rate have gone down to 4.05%. With 2.89% as the current lowest variable rate offered by Greater Bank and Reduce Home Loans. For the owner-occupied fixed rate, the lowest offering is at 2.79% which also belongs to Greater Bank.
Alongside with that, Homestar Finance holds the current lowest rate for an owner-occupied interest-only mortgage loan which is at 3.29%. This is in connection with the drop in the average owner-occupied interest-only loan at 4.45%.
Talking about the investor lending space, the average principal and interest rate has dropped to 4.48%. Wherein Reduce Home Loans currently holds the lowest variable rate at 3.19% and RACQ Bank for the lowest fixed rate at 3.09%. At the same time, RACQ Bank also holds the current lowest investment interest-only mortgage rate offered at 3.49%. This is also in connection with the drop in the average investment interest-only mortgage rate at 4.76%.
It is already expected to have more of these adjustments for the cash rate before the end of this year as the central bank has already stated before that they are always ready to make necessary adjustments as the case may be, in order to reach full employment goals and reach inflation targets.
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