The demand for fixed rate loans is on the rise as lenders hike rates on investment loans.
New data from Mortgage Choice shows fixed rate home loans rose to 18.46% of all loans in July, up from 17.58% in June. Mortgage Choice chief executive John Flavell said lenders' recent moves to raise rates on investment loans could account for the move toward fixing.
“Our data would suggest the threat of rising interest rates was enough to encourage more borrowers to fix their mortgage,” Flavell said.
Flavell said the trend toward fixed rates could continue as banks continue to change their policies and pricing.
“I wouldn’t be surprised to see another slight uptick in fixed rate home loan demand next month as borrowers look for some stability and certainty around their mortgage repayments,” he said.
While fixed rate loans saw an uptick in popularity, the vast majority of borrowers continued to opt for variable rates, and ongoing discount rates were particularly popular, accounting for 45.37% of all Mortgage Choice approvals in July.
"There is a lot of change happening in the home loan environment at the moment, which is highlighted by the fact that fixed rate demand varies quite substantially from month to month," Flavell said.
Can you afford to buy in this suburb? Find out how much you can borrow
Top Suburbs :
east victoria park
Get help with your investment property
Do you need help finding the right loan for your investment?
When investing in property, it is important to make sure that you not only have the lowest available rate that you can get, but also have the correct loan features for your needs.
Just fill in a few details below and we'll then arrange for a local Aussie Mortgage Broker to contact you and work out what features or types of loans are right for your needs. We'll even help with the paperwork. Plus and appointment is free.
We value your privacy and treat all your information seriously - you can check out