The highest rate increase came from Newcastle Permanent, which raised fixed rates by 0.20 percentage points, while, only one financial institution has lowered its rates before Christmas. Pixabay
Australian homeowners are facing an unwelcome holiday surprise this year, with major financial institutions raising both fixed and variable mortgage rates.
Despite the Reserve Bank of Australia (RBA) holding the official cash rate steady in December, data from Canstar shows that mortgage rates are still climbing.
According to Canstar’s insights director, Sally Tindall, the cycle of cutting fixed rates appears to have paused for now. However, she suggests that there could be some relief in the new year, with potential rate cuts offering much-needed support to homeowners, News.com reported.
“The second last full week before Christmas was dominated by fixed and variable rate hikes, with the Teachers Mutual Group, which includes Uni Bank, Health Professionals and Firefighters Mutual, hiking key new customer variable rates by 0.10 percentage points,” Tindall said.
The highest rate increase came from Newcastle Permanent, which raised fixed rates by 0.20 percentage points, while only one financial institution has lowered its rates before Christmas.
“Just Queensland Country Bank cut variable rates, while there were no lenders cutting fixed rates – a rare anomaly in a year that has been driven by fixed-rate cuts,” Tindall added.
The recent rate changes have resulted in only 178 mortgage rates below 5.75%, which is a decrease from 192 the previous week.
These rate hikes follow the RBA’s decision to maintain the cash rate unchanged at 4.35% for the ninth consecutive time. The RBA has expressed concern that underlying inflation remains too high, still above its target range of 2 to 3%.
For homeowners with a AU$600,000 loan over 30 years, Canstar notes that a 0.25% cut in the cash rate could lower monthly repayments by around AU$101, bringing the payment down to AU$3,984.
