Login
ISCOVER
Fixed rate home loan demand saw a boost last month, according to new data released by Mortgage Choice.
The group’s latest national home loan approval data showed that fixed rate home loans accounted for 18.46 per cent of all loans written throughout July, up from 17.58 per cent in June.
To continue reading the rest of this article, please log in.
Looking for more benefits? Become a Premium Member.
Create free account to get unlimited news articles and more!
Looking for more benefits? Become a Premium Member.
“Over the month of July, many lenders announced they would raise their interest rates across some products,” Mortgage Choice chief executive officer John Flavell said.
“The price increases come as many of Australia’s lenders continue to make some significant changes to their lending practices in a bid to curb investment lending growth.
“Our data would suggest the threat of rising interest rates was enough to encourage more borrowers to fix their mortgage.”
Mr Flavell noted that the loan environment is becoming increasingly complex for borrowers, with so many lenders making changes to their policy and pricing.
“I wouldn’t be surprised to see another slight uptick in fixed rate home loan demand next month as borrowers look for some stability and certainty around their mortgage repayments,” he said.
Nationwide, fixed rate demand was highest in New South Wales, with this type of home loan accounting for 26.83 per cent of all loans written in July.
This was followed by Queensland and Western Australia, with fixed rate home loans accounting for 16.33 per cent and 15.35 per cent of all loans written, respectively.
Victoria and South Australia saw the lowest demand for fixed rate products, with this type of home loan accounting for 11.87 per cent and 10.68 per cent, respectively.
While demand for fixed rates was up across the country, the data revealed that variable rate home loans remain the most popular with borrowers.
Variable rate home loans with an ongoing discount proved to be the most sought after, accounting for 45.97 per cent of all loans written in July.
“There is a lot of change happening in the home loan environment at the moment, which is highlighted by the fact that fixed rate demand varies quite substantially from month to month,” Mr Flavell said.
“With so much happening in the market, it has never been more important for potential borrowers to do their due diligence and speak with a professional to ensure they are getting the right home loan for their needs.”
[Related: FHB investment demand surges]
