According to national home loan approval data from Mortgage Choice, fixed rate home loans accounted for only 14.41% of all home loans written through September.
That figure is down from 17.41% during August.
“The last time fixed rate demand was this low was back in August 2011, when this type of home loan accounted for 13.78% of all home loans written,” Mortgage Choice chief executive officer John Flavell said
“It seems borrowers are increasingly opting for variable rate home loans as they believe rates are unlikely to rise for some time yet,” Flavell said.
Flavell said he believes the Reserve Bank is likely to keep the cash rate on hold at 2% for some time, and despite some upheaval in the country’s property markets, fixed rate loans are likely to remain unpopular for the time being.
“While the property market is showing signs of volatility at the moment, one thing is constant – low rates,” he said.
“While rates are low and there is little talk of future rate hikes, borrowers will continue to opt for variable rate products.”
Across the country, demand for fixed rate home loans was weakest in Victoria, where they accounted for just 8.61% of all loans written.
Western Australia was not far behind, with fixed rate home loans accounting for 12.35% of all loans written.
Fixed rate demand was strongest in New South Wales, accounting for 16.65% of all loans written.