Variable interest rates are set to remain steady In June, following today’s decision by the Reserve Bank to keep the cash rate on hold at the record low of 2 percent.
A RateCity analysis of over 3000 home loan products has revealed that a number of lenders have felt the pinch of last month’s RBA-led rate cut, with fewer than a third of lenders in the variable space passing on the rate cut in full to customers.
Peter Arnold, financial analyst at RateCity.com.au, said a further third of lenders were yet to announce any move to their variable home loan customers.
“Home loan lenders are feeling squeezed after last month’s 0.25 percentage point cut from the RBA and many have passed on only part of that cut to variable customers, with some passing on nothing at all,” he said.
“It’s in sharp contrast to the previous cut in February, when we had many lenders racing to pass on the cut in full.”
Bucking that trend, however, several small lenders and non-banks had slashed home loan rates – both fixed and variable – setting new record lows in the mortgage rate space, he added.
“The good news for borrowers is that there’s a few lenders competing fiercely with historic low rates, with fixed starting at 3.49 percent and variable from below 4 percent. So don’t wait for the RBA to get your next rate cut, switch today.
RateCity data shows that switching from the average standard variable home loan to one of the lowest on the market would be the equivalent of close to three RBA rate cuts.
To keep an eye on which lenders are moving rates, and by how much, keep an eye on RateCity’s Rate Tracker.