To continue reading the rest of this article, please log in.
Create free account to get unlimited news articles and more!
Citibank has slashed mortgage rates across its home loan product suite, effective for new business from Monday, 26 August.
The changes apply to loan amounts of $750,000 and over in NSW and Victoria and for loan amounts of $500,000 and over in all other states and territories.
Citi’s variable owner-occupied P&I home loan rates have been cut by up to 93 bps and will now start from 3.21 per cent (3.26 per cent comparison rate), while its fixed owner-occupied P&I rates have been cut by up to 160 bps and will now start from 2.99 per cent (4.61 per cent comparison rate).
Rates have also been slashed across Citi’s investment home loan product suite, for both borrowers paying P&I and for those paying interest only.
The bank’s variable investment P&I rates have been cut by up to 100 bps and will now start from 3.54 per cent (3.66 per cent comparison rate), while fixed P&I rates have been cut by up to 150 bps and will now start from 3.49 per cent (3.90 per cent comparison rate).
Further, Citi’s variable investment loans with interest-only terms have been cut by up to 100 bps and will now start from 3.74 per cent (3.88 per cent comparison ate), while fixed investment loans interest-only terms have been cut by up to 150 bps and will start from 3.69 per cent (4.89 per cent comparison rate).
In recent weeks, several lenders have lowered their home loan offerings, particularly across their fixed rate mortgage products.
Earlier this week, Westpac’s subsidiaries (the Bank of Melbourne, BankSA and St.George Bank) also slashed fixed rates across their owner-occupied and investment home loan offerings.
The lenders announced cuts of up to 140 bps, effective for new home loan applications received from 21 August.
The Bank of Melbourne and St.George slashed rates by between 10 bps and 1.35 per cent, with both banks’ owner-occupied fixed rates now starting from 2.94 per cent and investment fixed rates starting from 3.64 per cent.
Meanwhile, BankSA has cut rates by between 10 bps and 1.4 per cent, with its owner-occupied fixed rates now starting from 2.99 per cent and its investment fixed rates starting from 3.69 per cent.
According to Canstar’s finance analyst, Steve Mickenbecker, the cuts have come in response to a decline in wholesale funding costs.
“The fall in bond rates has reduced longer-term funding costs for lenders, and the Westpac subsidiaries have been able to pass this on to borrowers,” he said.
Also reflecting on the changes, RateCity research director Sally Tindall noted the shift in the mortgage market over the past few months and expects the wave of fixed rate cuts to continue.
“The idea of fixing your rate under 3 per cent until August 2024 is a foreign concept to a lot of Australian mortgage-holders,” she said.
“While these low fixed rates may seem like sensational deals, we’re likely to see more cuts.”