The mortgage market has had a dynamic week marked by various rate adjustments, including a fast decline in ultra-competitive fixed rates, latest Canstar insights has revealed.
Canstar’s latest weekly rates wrap-up showed that 25 lenders have increased 209 owner-occupier and investor variable rates by an average of 0.26%, while two have opted to cut two of theirs by an average of 0.16% during the week of Nov. 20-27.
Over the same week, 16 lenders have implemented increases in 283 owner-occupier and investor fixed rates, averaging 0.18%, while two lenders have reduced four fixed rates by an average of 0.2%.
See last week’s rate adjustments in the table below.
Following the changes, the average variable interest rate for owner-occupiers paying principal and interest now sits at 6.86% for an 80% LVR. The lowest variable rate for any LVR stands at 5.49%, available through Australian Mutual Bank and Hume Bank (both offering introductory rates).
There are currently five rates below 5.5% on Canstar’s database, down from eight in the previous week.
See table below for the lowest variable rates now on offer.
Effie Zahos (pictured above), Canstar’s editor-at-large and money expert, said Canstar analysis showed that 71% of variable rate lenders on Canstar’s database increased rates by an average 0.26% since the November cash rate decision. Despite these increases, there are still 43 rates below 5.75%, providing borrowers with options in a changing landscape.
Over the same period, the ultra-competitive short-term fixed rates are fast diminishing, as an escalating number of lenders increase fixed rates to safeguard their profit margins.
“Westpac’s cheapest one-year fixed rate is now 6.59% for an LVR of 70% or less or 6.69% for an 80% LVR, which is only 0.17 percentage points cheaper than the average variable rate at 6.86%. NAB’s one-year fixed rate is now at 6.69% for 70% or less LVR or 6.74% for 80% LVR.
For borrowers seeking a short-term fixed rate, the most affordable one-year fixed rate available is 5.5% for a 60% LVR or 5.79% for an 80% LVR. This represents a difference of at least 1.07 percentage points compared to the average variable rate of 6.86%.
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