Powered by MOMENTUM MEDIA
subscribe to our newsletter

Fixed rate demand at ‘highest levels in three years’

Demand for fixed rate home loans has risen to its “highest level in more than three years”, according to Mortgage Choice’s latest research.

Mortgage Choice’s national home loan approval data has revealed that fixed rate home loans made up 29.63 per cent of all loans written by their brokers in July 2017, the highest demand for fixed rate home loans since December 2013 (when fixed rate loans accounted for 33 per cent of loans), according to Mortgage Choice CEO John Flavell. 

Western Australia had the highest number of fixed rate loans in July, at 35.77 per cent of all home loans written, while NSW followed at a close second, with 33.59 per cent of all loans written. 

Queensland saw 28.08 per cent of all mortgages being for fixed rate loans, Mortgage Choice found. 

Mr Flavell said that the increasing popularity of fixing rates is not surprising, especially with the changes in the Australian mortgage market and the slew of recent interest rate adjustments. 

Advertisement
Advertisement

“Subsequently, borrowers wanting certainty and security over their repayments for a set period of time are increasingly turning to a fixed rate mortgage,” he said. 

Mr Flavell added that it remains to be seen whether borrowers will continue their flight to fixed rate home loans or “ride the changes in the market” by going for variable rate products. 

Indeed, variable rate home loans are still the most popular product for borrowers, accounting for more than 40 per cent of mortgages written. 

However, Mr Flavell said this trend could change.

He concluded: “If we continue to see added complexity in the market—with lenders making changes to their pricing and policy—I would expect to see more borrowers opting for the security of a fixed rate loan.”

PROMOTED CONTENT


[Related: Lender scraps IO repayments for owner-occupiers on fixed rates]

Fixed rate demand at ‘highest levels in three years’
mortgagebusiness

Are you a new-to-industry broker in the process of growing your business? Then there’s some great news: The Adviser’s New Broker Academy is back in 2021 and will provide you with essential insights into cutting-edge tools, strategies and processes to fast-track to success. Don’t miss your chance to attend. To secure your FREE place, visit newbroker.com.au now!

Annie Kane

Annie Kane is the editor of The Adviser and Mortgage Business.

As well as writing about the Australian broking industry, the mortgage market, financial regulation, fintechs and the wider lending landscape – Annie is also the host of the Elite Broker and In Focus podcasts and The Adviser Live webcasts. 

Contact Annie at: This email address is being protected from spambots. You need JavaScript enabled to view it.

Latest News

Reverse mortgage lenders have accessed a small fraction of the potential retiree housing market in Australia, according to Deloitte. ...

Pepper Money has priced its second I-Prime deal for the year, upsizing the figure to $850 million. ...

The LMI provider has announced a new CFO following the resignation of its current CFO, effective 24 September. ...

Join Australia's most informed brokers

Do you know which lenders are providing brokers and their customers with the best service?

Use this monthly data to make informed decisions about which lenders to use. Simply contribute to the survey and we'll send you the results directly to your inbox - completely free!

How long do you think it should take to discharge a mortgage?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.