First home buyers in Sutherland Shire and Sydney concerned by bank rate hikes

December 01, 2015
Tedy Ferreira

1 in 5 FHBs ‘didn’t know’ lenders could move rates independently of the RBA

 Lenders moving their rates independently of the Reserve Bank of Australia is “worrying” the majority of first time buyers in the Sutherland Shire and Sydney, new data has revealed.

According to Mortgage Choice’s annual First Home Buyer Survey, more than half (57.5%) of Australians planning to purchase property in the next two years are ‘very concerned’ or ‘somewhat concerned’ about lenders moving interest rates independently of decisions made by the central bank.

These findings come just weeks after Westpac, CBA, NAB, ANZ and a host of non-major lenders all lifted their rates.

In October, we saw the big four banks raise their variable rates independently of the RBA by an average of 18 basis points, which clearly concerned first time buyers

To put these rate increases into a dollar figure, an 18 basis point rate increase would see a home owner’s monthly mortgage repayments climb by more than $45* per month on a $400,000 mortgage with an interest rate of 5.43%.

While many potential first home buyers are “understandably” concerned about the idea of the banks raising their rates independently of the Reserve Bank, it was important to remember that even with this latest rate hike by some of Australia’s lenders, home loan rates continue to sit at 50 year lows.

Now is still a great time to be a first home buyer in the Sutherland Shire as there are plenty of incredibly competitive, sharply priced products they can choose from in Miranda, Caringbah and surrounding areas.

While the survey found the majority of potential first time buyers are concerned about rates rising independently of the Reserve Bank, Mr Flavell, Mortgage Choice CEO, said the data also found one in five future first time buyers didn’t even realise the banks could or would move rates on their own terms.  

When you consider that 18.3% of first time buyers didn’t know the banks could move rates independently of the Reserve Bank, it is clear there is more work to be done to help improve the financial literacy of Australians. Anyone planning to get their foot on the property ladder needs to understand the role and power financial institutions have on the rise and fall of interest rates.

Buying property is one of the biggest financial commitments a person will ever make, so future first home buyers need to know exactly what they are getting themselves in for when taking on a mortgage.

Consulting with one of the loan consultants at Mortgage Choice in Miranda will ensure first time buyers understand the options available to them while also receiving advice on the home loan that is best suited to their needs.

If you would like learn more about your home loan or financial advice options, call 02 9526 7888 or visit  

*Estimate repayment increase calculated using a 5.43%, $400,000 P&I mortgage, which rises 18 basis points to 5.61%.


About the Survey

Market research company, Nine Rewards, was commissioned by Mortgage Choice to conduct the 2015 First Home Buyer Survey. The online Survey was conducted in October and completed by more than 1,000 Australians who purchased their first home within the last two years or are looking to purchase in the next two years.


Posted in: First home buyers

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