One-year, two-year and three-year fixed-rate mortgages are currently cheaper than variable-rate home loans, according to new data.
At the end of January, the average of all the variable rates listed on RateCity was:
- 4.47 per cent for owner-occupiers
- 4.91 per cent for investors
Meanwhile, average fixed rates for owner-occupiers were:
- 4.21 per cent for 1 year
- 4.16 per cent for 2 years
- 4.23 per cent for 3 years
For investors, the averages were:
- 4.53 per cent for 1 year
- 4.48 per cent for 2 years
- 4.56 per cent for 3 years
But while one-year, two-year and three-year fixed rates were cheaper than variable rates, four-year and five-year fixed rates were more expensive, according to the data.
At the end of January, average fixed rates for owner-occupiers were:
- 4.60 per cent for 4 years
- 4.65 per cent for 5 years
For investors, the averages were:
- 4.89 per cent for 4 years
- 4.97 per cent for 5 years
Cheapest variable-rate mortgages on the market
Focusing just on the variable-rate home loans listed on RateCity, it’s still possible to get a mortgage for an historically low rate.
At the end of January, the cheapest rate for owner-occupiers was:
- Reduce Home Loans’ Rate Buster Standard Home Loan at 3.39 per cent (comparison rate 3.39 per cent)
The cheapest rate for investors was:
- Reduce Home Loans’ Rate Buster Investor Wealth Maximizer at 3.69 per cent (comparison rate 3.69 per cent)
It’s important to note that the cheapest home loan isn’t always the best – for some borrowers, a mortgage with a higher rate will be a more suitable option.
