The past week saw varying changes in the home loan rates among Australian lenders, Canstar reported.
Three lenders increased 18 owner-occupier and investor variable rates by an average of 0.13%, while two other lenders cut 23 fixed rates by an average of 0.19%.
Despite these changes, 26 rates remain below 5.75% on Canstar’s database, consistent with the previous week.
The current average variable interest rate for owner-occupiers paying principal and interest stands at 6.87%. Meanwhile, the lowest available variable rate for any LVR is 5.74%, an introductory rate provided by Regional Australia Bank.
Steve Mickenbecker (pictured above), Canstar’s group executive for financial services and chief commentator, provided insights into the Reserve Bank’s upcoming decisions.
“A mixed bag of data looks likely to see the RBA leave the cash rate left on hold,” Mickenbecker said. “March quarter inflation was up and the housing market is again booming, but economic growth has stalled. The RBA will wait on at least the June quarter Consumer Price Index number before moving on the cash rate.”
In light of slower progress towards the inflation target, ANZ Bank has revised its projection for the first cash rate cut to February 2025.
“In bad news for borrowers ANZ Bank has pushed out its projection for a first cash rate cut to February 2025 in reaction to slower than expected progress of inflation towards the 2% to 3% RBA target band. The other big banks are sticking to November 2024 for now,” Mickenbecker said.
RBA maintained the cash rate at 4.35% as of May 2024. However, expectations are high for a forthcoming rate cut, potentially leading to a decrease in monthly repayments for borrowers.
For example, a 0.25% cut could reduce monthly repayments on a $600,000 loan over 30 years by $101, bringing it down to $3,984.
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