Borrowers look to fix rates
Ongoing speculation around rising interest rates appears to have convinced many Australians to lock-in to fixed rate home loans, according to the latest data from Mortgage Choice.
According to Mortgage Choice, demand for fixed rate loans reached its highest level in five months in June, reaching 12.3 per cent of all approvals.
It said every state apart from South Australia had seen a rise in the appetite for fixed rate loans, with the largest increase occurring in Western Australia, where demand rose from 9.4 per cent in May to 14.2 per cent in June.
Commenting on the data, Mortgage Choice spokesperson Kristy Sheppard said constant speculation about interest rate rises occurring in the latter half of 2011 and beyond may have convinced a higher number of borrowers to simply lock in their rates.
She said July’s data would prove interesting because over the past month several lenders had reduced their fixed rates on home loans.
“Now there’s one-tenth of a per centage point between the average three-year fixed rate, traditionally the most popular with borrowers, and the average basic variable rate,” Sheppard said.
AUTHOR
Mike Taylor
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