The Big Four bank’s 2, 3, 4 and 5-year rates will all go up by 10 basis points, with only the 2-year fixed now below the 2% barrier.
2-year is at 1.99%, 3-year is now 2.08%, 4-year is 2.59% and 5-year is as high as 2.89%.
Westpac has made their change on the back of huge news that came from CBA on Friday, when they slashed 40 points off their basic variable rate, but hiked their fixed rates for mortgages across the board.
It makes a return to the situation that many lenders were in earlier in the year, before New South Wales and Victoria entered their long winter lockdowns, when there was a difference of opinion between the Reserve Bank of Australia and major banks on the cash rate.
Now, opinions have aligned and most expect that the cash rate will not move until 2024, however increasing lending standards have been implemented to constrain rapidly rising house prices.
With banks now raises rates on the long-term, it signals that the Big Four think that the cash rate will remain at 0.1% until at least two years from now, but are likely to go up after that.
Fixed rates had been consistently rising in popularity across the industry, as borrowers sought to lock in their 2021 rate over a long term before inevitable rises in the future.
Some brokers had reported that 40% of refinancing deals that they were doing were at fixed rates. For comparison, earlier in the year, that number was just 20%.
