Orange Credit Union and HSBC lead with biggest reductions
Fixed rate cuts took centre stage in the mortgage market last week, as several lenders opted to slash rates across various loan terms, according to financial comparison website RateCity.com.au.
Orange Credit Union led the charge by implementing a 1% reduction to its three-year rate for owner-occupiers paying principal and interest. HSBC also made adjustments to a selection of fixed-rate products, reducing them by up to 0.80 percentage points.
Three other lenders made major rate changes, as shown in the table below, with RACQ increasing its owner-occupier principal and interest two-year fixed and variable rates for customers with substantial deposits (LVR of less than 60%) by 0.10 percentage points to 6.04%.
Following last week’s rate adjustments, the following banks now offer the lowest fixed and variable rates, as depicted in the table below.
In the previous week, the trend also leaned towards more reductions in fixed rates than hikes.
Sally Tindall (pictured), research director at RateCity.com.au, pointed out that while fixed rates are now starting to come down, it does not automatically make them competitive.
“The RateCity.com.au database shows most lenders’ lowest rates are still variable ones,” she said. “We’ve likely hit the peak of fixed rates. Our database shows the average of lenders’ lowest two-year fixed rates was highest in mid-December of last year.”
Tindall said that further reductions on fixed rates can be expected as a cash rate cut inches closer.
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