Current rate landscape
The average variable interest rate for owner-occupiers paying principal and interest stands at 6.9% for an 80% LVR. However, the lowest variable interest rate available across any LVR is an introductory rate of 5.69% from Australian Mutual Bank.
According to Canstar’s database, there are 19 rates below 5.75%, maintaining the previous week’s numbers, and 225 rates are below 6%, substantially lower than the average loan rate.
Fixed and variable Interest rate changes
Two lenders have raised three owner-occupier and investor variable interest rates by an average of 0.05%. In contrast, four lenders have reduced 15 owner-occupier and investor variable interest rates by an average of 0.15%.
This week saw no increases in fixed interest rates for either owner-occupiers or investors. However, 14 lenders made substantial cuts to 272 fixed interest rates, with an average reduction of 0.33%, signalling a significant shift towards more affordable borrowing costs.
Pre-September Interest rate cuts ‘unlikely’: Westpac
Following the February monetary policy meeting, the conversation about rate cuts has been front of mind for bank economists, specifically around the timeline of when the Reserve Bank of Australia (RBA) will begin to lower interest rates.
Westpac chief economist Luci Ellis has outlined the major bank’s reasoning behind why they believe that rate cuts are expected to occur after the late-September monetary policy meeting and why it’s unlikely that the central bank will move before this date.
Ms Ellis noted that the current expectation of a September cash rate cut is predicated on the basis that “things will turn out broadly” as the major bank and the RBA expect.
“Inflation continues to decline, while growth remains soft in the first half of the year but does not fall away completely. Unemployment drifts up but does not rise precipitously,” she said.
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If you’re age 60 or over, own your own home and need to access money, a reverse mortgage is one way that you may be able to leverage the equity in your home to access extra cash.
Here we look into the basics of what you need to know about reverse mortgages when considering if this option is right for you.
*Please note this information is general. The terms and conditions of particular loans differ. Information is correct as at 1 September 2023 and is subject to change. AFG Home Loans lending criteria, terms, conditions, fees, and charges apply. Full details of terms & conditions available on application. **Please note, we do not provide tax, legal or accounting advice. This content is for general informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. We encourage you to consult your own tax, legal and accounting advisers before engaging in any transaction.
