New data from the Australian Bureau of Statistics has found that the number of borrowers choosing to fix their home loan has declined since August 2017.
So why are fewer borrowers fixing their home loan rate? And what exactly does this mean for you? Here are the facts.
Borrowers over the past few years have been more likely to fix their interest rate and lock in the advantages of historically low cash rates.
Since August 2016, the Reserve Bank of Australia has left the cash rate unchanged at 1.5%, which has been a real coup for owner occupiers.
Despite this, people are starting to prefer variable interest rates, which fluctuate in line with the market.
Although interest rates could certainly decrease in the future, Finance Heads such as Canstar group manager Mitchell Watson, say borrowers should consider their options carefully.
“With fixed rates as low as they are and speculation of a rate rise in the later part of 2018 it is understandable why people may be considering fixing their loan. Fixed interest rates when compared to variable interest rates are very attractive with one, two and three-year fixed rates sitting lower than the average variable interest rates,” he said to Perth Now.
For more information on fixed versus variable rates, head here.
Choosing between fixed interest rates, variable rates or a mixture of the two is a choice only you can make.
However, we highly recommend speaking with a good mortgage broker about your options, before making a decision.
A good broker examines your current circumstances, including your financial history and goals, as well as the market. They then research and tailor a loan solution that fits you, and saves you more.
Our brokers can assist you with choosing an interest rate that is most suited to you.
Contact us to get started.
Financial Advice Disclaimer: This information is general in nature. Mortgage brokers do not provide financial advice. Clients seeking financial advice will be referred to a qualified financial planner.