Increase comes after parent company Westpac raises its own rates
St. George has hiked its fixed rates for owner-occupier and residential investment loans, the latest in a series of rate hikes by lenders.
The principal and interest on St. George’s fixed rates rose by as much as 0.65 percentage points on Friday, and increased up to 0.55 percentage points for interest-only loans, according to a report by The Australian.
The fixed rate for principal-and-interest and integral-only investment loans rose by 0.55 percentage points.
“We continue to offer customers competitive home loan interest rates across fixed-rate products,” St. George said in a statement. “We continually review our home loan products in line with changing business and market conditions. In making these decisions, we consider multiple factors, including the need to manage pricing changes in a sustainable way. These changes reflect the continued increase in funding costs.”
St. George parent company Westpac also increased the standard variable base rate for Westpac Life savings customers by 0.5% on Friday, bringing the total variable interest rate to 1.35%, The Australian reported. The hike came after Westpac’s mortgage rates for new and existing customers rose by 0.5 percentage points on Wednesday.
Westpac also increased its fixed home rates by up to 0.6 percentage points for both owner-occupiers and investors on all fixed-rate terms.
ANZ predicted last week that the Reserve Bank of Australia would hike rates four more times over the coming months, pushing the official cash rate above 3% before Christmas.
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“Our expectation is that the RBA will deliver this via four more successive 50 basis point rate hikes in August, September, October and November,” ANZ head of Australian economics David Plank wrote. “This 200 basis points of additional tightening sees the cash rate target at 3.35% by November.”
RBA Governor Philip Lowe confirmed last week that rates would keep rising, The Australian reported.
“We’re going through a process of steadily increasing interest rates, and there’s more of that to come,” Lowe said. “We’ve got to move away from these very low-level interest rates we had during the [COVID-19] emergency.”
