Fixed-rate demand skyrockets

The number of borrowers who choose a fixed rate for their home loan has hit a nine-month high.

According to research by Mortgage Choice, fixed-rate home loans accounted for 26.98 per cent of all loans written in November, up from 26.64 per cent in the previous month.

Mortgage Choice spokesperson Jessica Darnbrough said that while rates are currently at all-time lows, more borrowers are looking for certainty with their repayments.

“A growing number of borrowers are beginning to realise that while rates are low, they can’t stay this way forever,” she said.

“Furthermore, a lot of lenders slashed the interest on their suite of fixed-rate products at the end of July, and we are finally starting to see the result of those rate movements coming through in our data.”

The research also showed that ongoing discount variable rates accounted for 40.43 per cent of all loans written in November, up from 37.43 per cent in the previous month.

Ms Darnbrough said that with variable rates so low at the moment, it is no surprise that a majority of borrowers are opting for this type of product.

“Of course, with interest rates currently sitting at historical lows and Australia’s lenders competing aggressively for business, borrowers can be assured of securing a good rate regardless of which product type their opt for,” she added.

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