Demand for fixed rates is at its highest level since December 2013, with nearly one-third of borrowers opting for the repayment type, Mortgage Choice reveals.
According to home loan approval data from Mortgage Choice, fixed rate home loans made 31.05 per cent of total loans written in August.
That figure is up from 29.63 per cent in July and reflects the highest demand since December 2013, Mortgage Choice CEO John Flavell noted.
The rolling six-month national average is 26.57 per cent and the annualised average sits nearly 8 per cent lower than the August result, at 23.36 per cent of loans.
“The growing popularity of fixed rate mortgages is not a surprise. Recently, we have seen a number of Australia’s lenders cut the interest rates charged on some of their fixed rate products,” Mr Flavell said.
“As a result, fixed rate home loans are now very competitively priced, which has made them more attractive to home owners who are looking for repayment security.”
The data showed that fixed rate demand was strongest in Queensland, making up 35.48 per cent of all loans written in August; fixed rate loans in July made 28.08 per cent.
Just over one-third of borrowers (34.40 per cent) in the combined South Australia and Northern Territory regions opted for the loan type, and the combined New South Wales and ACT regions followed closely, with 33.66 per cent of loans written being fixed rate.
Demand was lowest in the combined Victoria and Tasmania regions, at 22.07 per cent.
Introductory rate demand was highest in the combined Victoria/Tasmania regions, accounting for 4.50 per cent of loans.
The national average is 2.84 per cent, up from 2.67 per cent in July but still below the 12-month average, 3.79 per cent.