New data shows one in four Australians are fixing their mortgage
While variable rates remain the most popular type of home loan with Australian borrowers, fixed rate demand hit a four month high in September.
According to the latest Home Loan Choices data from Mortgage Choice, fixed rates accounted for 25.45 per cent of all loans written last month – up from 24.19 per cent the month before.
Mortgage Choice franchisee Jonathan Lee said the lift in fixed rate demand was expected as Australia’s lenders have been quite aggressive in the fixed rate arena recently.
“At the end of July and the beginning of August, many of Australia’s lenders actively cut the interest on their suite of fixed rate products, which encouraged more borrowers to opt for a fixed rate mortgage,” he said.
“It usually takes a month or two for us to see any increase in demand for a particular product flow through the data, but we are definitely starting to see that now.”
Across the country, fixed rates were most popular in New South Wales, where this type of product accounted for 30.75 per cent of all loans written last month – up from 25.30 per cent in August.
Demand for this particular product was also up in Victoria, with fixed rates accounting for 18.10 per cent of all loans written – up from 16.70 per cent the month before.
Despite the growing demand for fixed rate products in some states, Jonathan said variable rate home loans continue to dominate the market, with this type of product accounting for 74.55 per cent of all loans written across the country in September.
“Once again, ongoing discounted rates were the most popular of all the variable rate products, with this type of home loan accounting for 38.01 per cent of all loans written in September,” he said.
“Even though we saw a lot of lenders trim the interest on their suite of fixed rate products recently, it is clear the majority of borrowers are happy to take their chances on a variable rate mortgage.
“Variable home loan rates are still sitting at historical lows, and as such, it isn’t surprising to see that this type of loan is popular with borrowers. That said, with fixed rates also sitting at historical lows, borrowers can rest assured that regardless of the product they choose, they should be able to snag a very competitive rate.”
To find out if fixed rates will work for you call Jonathan now on 0499 643 643.