Today, Westpac raised its three-, four- and five-year fixed rates to 0.21% just two days after the Reserve Bank of Australia (RBA) decided to keep interest rates at the level record 0.10%.
St George and Bank of Melbourne, both of which are part of the Westpac Group, also increased their fixed rates to two, three, four and five years, but cut their base variable rate by 0.10%.
RateCity.com.au’s research director, Sally Tindall, said the short period between rate hikes was likely due to the RBA signaling a change in its “yield curve control” policy , which could indicate that rates will rise sooner than expected.
“Westpac has further raised its long-term fixed rates due to an expected increase in the cost of funding. The RBA’s change in monetary policy this week likely spurred that decision,” Ms. Tindall said.
“We expect more banks to raise fixed rates in the coming weeks and months, with some likely to increase multiple times in response to improving economic conditions.
“For anyone considering setting their rate, it’s not too late to get a good deal. However, in this environment where banks are scrambling to announce their fixed rate hikes, people might consider paying a fee. rate freeze. “
According to Pete Wargent of the online real estate platform BuyersBuyers, the data shows the market is aware that fixed rates will rise and has planned accordingly.
“Last quarter we saw a record share of borrowers taking out fixed rates, confirming that real estate insiders agree the bottom of the interest rate cycle is on,” Wargent said.
“But context matters, and the share of household income spent on interest repayments is almost as low as we’ve seen over the past four decades.
“Even 100 basis points of interest rate increases from here can be absorbed by the market, as interest rates (and therefore monthly repayments) will always remain favorable relative to historical averages.”
Westpac modifies its lowest mortgage rates (owner-occupiers, 70% LVR)
|
To lend |
Old rate |
New rate |
Switch |
|
3 years fixed |
2.08% |
2.29% |
+ 0.21% |
|
4 years fixed |
2.59% |
2.69 percent |
+ 0.10% |
|
5 years fixed |
2.89 percent |
2.99% |
+ 0.10% |
Note: The above rates apply to homeowners who pay principal and interest on a flat rate with an annual fee of $ 395 for a loan-to-value ratio of 70% or less. Data from RateCity.com.au
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