New research by Mortgage Choice reveals that fixed-rate home loan demand has fallen to its lowest level in more than two years.
The group’s latest national home loan approval data found fixed-rate home loans made up just 17.91 per cent of all loans written in April, down from 18 per cent in March.
Mortgage Choice chief executive John Flavell said demand for fixed-rate home loans hasn’t been this low since February 2013.
“Fixed-rate demand has taken a significant hit in recent months,” he said.
“Just one year ago, fixed-rate demand was sitting at record highs and now it is hovering near record lows.”
Mr Flavell noted the sudden drop in fixed-rate demand appears to be caused by an increasing number of borrowers believing home loan interest rates may fall further over the coming months.
“This is understandable given that the Reserve Bank of Australia continues to indicate that further easing of monetary policy may be appropriate,” he said.
The data showed variable home loan rates, specifically ongoing discount mortgages, continue to be the most popular product amongst borrowers, accounting for 43.96 per cent of all loans written.