A record 31 lenders are offering, or set to offer, at least one mortgage rate under 2 per cent – almost triple the number before last week’s RBA cut.
Already 17 of these lenders have advertised rates under 2 per cent, while a further 14 lenders will make their new rates available in the coming days.
RateCity.com.au database analysis:
- 41 lenders have so far announced cuts to rates since last Tuesday.
- Of these, just 5 lenders have passed on variable rate cuts to their existing customers (see list below).
- 1.77% is the lowest variable rate on the market.
- 1.88% will be the lowest fixed rate on the market (2-years), effective from 19 November.
- 31 lenders are set to offer at least one fixed or variable rate under 2%.
- Australia’s three largest banks now have fixed rates under 2% (CBA, Westpac and NAB).
Company | Product Green Home Loan Real Time Rating™ Winner of Best Green Home Loan, RateCity Gold Awards 2022 | Interest Rate 2.13 % p.a Variable | Comparison Rate* 2.55 % p.a | Repayment $1,291 monthly | Go to site | Winner of Best Green Home Loan, RateCity Gold Awards 2022 | |
Company | Product Variable Home Loan Real Time Rating™ | Interest Rate 2.09 % p.a Variable | Comparison Rate* 1.99 % p.a | Repayment $1,285 monthly | Go to site | special Receive $5,000 AUD cashback when you refinance your existing home loan ~ Ends in about 1 month | |
Company | Product Smart Booster Home Loan Discounted Variable - 2yr Real Time Rating™ | Interest Rate 2.10 % p.a Intro 24 months | Comparison Rate* 2.46 % p.a | Repayment $1,346 monthly | Go to site | ||
Company | Product Low Rate Home Loan - Prime (Owner Occupied) (Principal and Interest) Real Time Rating™ Winner of Best Refinance Home Loan, RateCity Gold Awards 2022 | Interest Rate 2.14 % p.a Variable | Comparison Rate* 2.14 % p.a | Repayment $1,292 monthly | Go to site | Winner of Best Refinance Home Loan, RateCity Gold Awards 2022 | |
Company | Product Low Rate Home Loan - Prime (Owner Occupied) (Interest Only) Real Time Rating™ | Interest Rate 2.44 % p.a Variable | Comparison Rate* 2.24 % p.a | Repayment $610 monthly | Go to site |
Homeowners can now get 1-5 year fixed loans for under 2%
In an historic first, homeowners can now sign up for a one, two, three, four and five-year fixed loan –for under 2 per cent.
Locking in a rate is becoming an increasingly popular option for Australian mortgage holders, with CBA telling RateCity that around 40 per cent of new loans were fixed, while Westpac has said 28 per cent of their entire loan book is on a fixed rate.
Lowest owner-occupier rates on RateCity.com.au - Note some rates will become available later this month.
Lender | Advertised rate | |
Variable | Reduce Home Loans | 1.77% |
1-year fixed | Homestar Finance/ Newcastle Permanent | 1.98% |
2-year fixed | HSBC | 1.88% |
3-year fixed | UBank | 1.95% |
4-year fixed | Westpac/ St George/ Bank of Melbourne | 1.89% |
5-year fixed | Newcastle Permanent | 1.99% |
Source: RateCity.com.au Home loans above are available Australia-wide. LVR restrictions may apply. HSBC rate available from 19/11. UBank rate available 13/11. Newcastle Permanent rate available 11/11.
Big four banks – lowest owner-occupier rates
CBA | Westpac | NAB | ANZ | |
1 year fixed | 2.19% | 1.99% | 2.19% | 2.09% |
2 year fixed | 2.14% | 1.99% | 2.09% | 2.09% |
3 year fixed | 2.14% | 1.99% | 2.09% | 2.09% |
4 year fixed | 1.99% | 1.89% | 1.98% | 2.29% |
5 year fixed | 2.99% | 2.69% | 2.79% | 2.29% |
Lowest variable rate | 2.69% | 2.19% for 2 yrs then 2.69% | 2.69% | 2.72% |
Source: RateCity.com.au Note: Westpac's rates are for a loan to value ratio of 70%.
RateCity.com.au research director Sally Tindall said: “At the beginning of this year, no one would have predicted there would be more than 30 lenders with rates under 2 per cent.”
“It’s no longer just online lenders with low rates. The bigger banks are now starting to steal their thunder offering up fixed rates under 2 per cent,” she said.
“For the average borrower, refinancing to a low fixed rate could save them thousands of dollars a year but locking in is not for everyone.
“Don’t rush into fixing. Make sure you’re happy with the rate but also with the terms and conditions that come with a fixed rate.
“Split loans can be a good option for people looking to take advantage of the record low fixed rates but still want to keep their offset or make extra repayments,” she said.
RateCity Tips: What to consider before committing to a fixed rate mortgage
- Are you happy with the rate?
- How many years you want to fix your home loan for?
- What’s your plan for the property – are you likely to sell?
- Would a split loan work for your finances? Spilt loans where a portion is variable can often help retain some flexibility in the loan.
- Do you want to make extra repayments or have the flexibility of an offset?
Lenders passing variable rate cuts onto existing customers
Lender | Cut | New lowest variable | Effective date |
Athena Home Loans | -0.15% | 2.19% | Nov-03 |
Homeloans.com.au | -0.15% | 2.14% | Nov-06 |
Me Bank | -0.15% | 2.43% | Nov-26 |
P&N Bank | -0.10% | 2.49% | Nov-20 |
UBank | -0.15% | 2.34% | Nov-29 |
Source: RateCity.com.au