Cash rate back in a holding pattern while new customer rates continue to fall



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The RBA left the cash rate on hold this month at a record low of 1 per cent, but borrowers can still get a further rate cut if they turn themselves into new customers.

RateCity.com.au data shows the average home loan customer has received a rate cut of around 0.43 per cent over the last two months. Over the same period, the lowest ongoing variable rate has dropped by 0.55 per cent – but only for new customers.

Meanwhile, 65 lenders have cut fixed home loan rates over the last month, with cuts of up to 1 per cent.

RateCity.com.au research director Sally Tindall said while further RBA cuts were still very much on the cards, it was unlikely they would come in the next couple of months.

“The RBA is back in a holding pattern. It wants time to see how the two consecutive rate cuts, and the government’s tax cuts, play out in the economy before resorting to yet another cut,” she said.

“Banks are slashing both fixed and variable rates for new customers so if you’re in a position to refinance, now is a great time to take advantage of this home loan rate war.

“Not one, but two lenders are now offering ongoing variable rates of 2.89 per cent, while 3-year fixed rates are as low as 3.94 per cent,” she said.

Lowest advertised variable rates on RateCity.com.au

Lender

Rate

Reduce Home Loans

2.89%

Mortgage House

2.89%*

Well Home Loans

2.97%

*Excludes NSW 

Lowest advertised fixed rates on RateCity.com.au

Lender

Rate

Pacific Mortgage Group

2.94%

Mortgage House

2.96%

Reduce Home Loans

2.97%

Note: Rates are for owner occupiers paying principal and interest.

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