DEMAND for fixed rate home loans fell in June according to newly released data from Mortgage Choice.<\/p>\n
According to the company\u2019s home loan approval data, demand for fixed rate home loans was down and accounting for 21 per cent of all home loans written.<\/p>\n
Chief Executive Officer Susan Mitchell said the drop in demand is hardly surprising considering the spate of variable interest rate reductions that followed the two consecutive cash rate cuts from the Reserve Bank.<\/p>\n
\u201cA snapshot of approval data suggests borrower preference for variable loans is growing,\u201d Ms Mitchell said.<\/p>\n
\u201cIf we look at the split of variable rate and fixed rate home loans at the end of last week, we can see a clear shift towards variable rate loans.<\/p>\n
\u201cWhat is truly shocking about this data is that demand for fixed rate loans has not been this low in almost eight years.\u201d<\/p>\n
The June approval data revealed that variable rate demand was highest in Victoria, where 86 per cent of borrowers opted for this type of product.<\/p>\n
Ms Mitchell said that both weekly and monthly data indicates that borrowers know there are great deals to be had.<\/p>\n
\u201cIndeed, the high level of demand for variable rate loans with an ongoing discount reveals that many of our customers are receiving a discount on packaged home loans beyond what lenders are offering.<\/p>\n
\u201cThis increase in demand is a combination of our brokers negotiating a better rate with lenders and customers actively asking for a better rate.<\/p>\n
\u201cFor most of us, our home loan is our most significant debt, so you are really doing yourself a disservice by being afraid to haggle.<\/p>\n
\u201cThat being said, I think it\u2019s important for borrowers who may be considering a fixed rate to know that we have seen a significant reduction in fixed rates offered by the lenders on our panel, which suggests that the outlook is for rates to remain lower for longer.<\/p>\n
\u201cIf you are seeking home loan repayment certainty going forward, there are great deals on the market, with fixed rates as low as 3.09 per cent.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
DEMAND for fixed rate home loans fell in June according to newly released data from Mortgage Choice. According to the company\u2019s home loan approval data, demand for fixed rate home loans was down and accounting for 21 per cent of all home loans written. Chief Executive Officer Susan Mitchell said the drop in demand is […]<\/p>\n