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Variable rates have grown in popularity as intense competition has forced lenders to offer discounts.
Mortgage Choice reported that 74.13 per cent of its volumes in May were variable loans, while 25.87 per cent were fixed loans.
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Variable loans represented 73.51 per cent of volumes in April and 69.94 per cent in December.
Spokesperson Jessica Darnbrough said lenders had been offering “sensational variable rate discounts” to attract borrowers and grow their market share.
“We have seen some lenders offering discounts of up to 1.3 per cent and even 1.4 per cent off the standard variable rate,” she said.
“We haven't seen this level of discounting for some time, so it is no surprise to see the popularity of variable rate products on the rise."
Banks told The Adviser last month that they were feeling the pressure of competition after one lender after another had cut rates in 2014.
Meanwhile, a Mortgage Choice survey of first-time investors revealed they were more concerned about location than finance.
According to the survey, 50.6 per cent of respondents who purchased their first investment property within the past two years said their biggest challenge had been finding the right property.
Another 15.5 per cent nominated choosing the right investment strategy, while 15.3 per cent said it was saving a deposit.
Ms Darnbrough said Mortgage Choice had expected a greater number of first-time investors to have been concerned about saving a deposit given the rise in property values over the past 12 months.
“For investors, it seems location is everything. A property that is located in a good suburb and near the necessary amenities including cafes, restaurants and local transport, is likely to attract more tenants, which can help to increase the rental income generated by the property,” she said.
