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It’s no secret that the lenders around Australia are starting to change their fixed rates by moving them up.
We have seen unprecedented levels of interest in fixed rates this year with many lenders very aggressive in picking up longer term clients.
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Fixed rates around Australia currently equate to about 30% of all new lending each month. With the extended discounts on fixed rates, it’s certain that many borrowers have reviewed their mortgage in line with these offerings. However, the time is now for finance brokers around Australia to send campaigns to their clients advising of the potentially limited time these rates may stay at these levels.
Lenders may also have a limited opportunity to take advantage of the current fixed rate levels. With a number of housing affordability observers suggesting it currently sits at the best it has been for 10 years, the consistency and security of a fixed loan may be the added incentive buyers need to enter the market.
A benefit of fixing a home loan is the certainty of repayments. It means households can budget and plan for strategies they may need if there was to be a change in household income. Many investors will be attracted by the lower rates with yields at or slightly higher than medium term rates.
Nathan Swain, CEO Australian Property Finance
Nathan Swain is CEO of Australian Property Finance (APF), which is outcome of the RE/MAX Australia and Vow Financial joint venture launched in August 2013 to write a full range of financial services for home buyers and property owners including new and refinanced commercial, residential and personal loans, insurance, wealth creation, legals and leasing. He has two decades’ worth of finance experience, including recognition in the top 1% property finance performers with a major real estate group.
