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Variable interest rates are set to remain steady for the remainder of June as a result of the Reserve Bank’s decision to keep the cash rate on hold.
A RateCity analysis of over 3,000 home loan products has revealed that less than one-third of lenders cut their variable rates by the full 25 basis points in May, following the Reserve Bank’s decision to reduce the cash rate from 2.25 to 2.0 per cent.
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Financial analyst Peter Arnold said another one-third of lenders were yet to announce any move to their variable home loan customers.
“Home loan lenders are feeling squeezed after last month’s 0.25 percentage point cut from the RBA and many have passed on only part of that cut to variable customers, with some passing on nothing at all,” he said.
Mr Arnold said that was in sharp contrast to the February rate cut, when many lenders raced to pass on the cut to customers.
However, several small lenders and non-banks have slashed home loan rates – both fixed and variable – setting new record lows in the mortgage rate space, he added.
[Related: Low rates drive big growth for YBR]
