It was a quiet week on the home loan market, but that doesn't mean it was a boring one.
Indeed, Australia's largest bank made a bang when it brought about a first: it's brand new Digi Home Loan.
Meanwhile, three mutuals took a knife to home loan rates, cutting those on fixed, variable, and offset mortgage products.
All that occurred despite a potentially disappointing inflation read.
The Australian Bureau of Statistics (ABS) revealed inflation was still buoyed in April, with annual consumer price growth rising slightly month-on-month to 3.6%.
That suggests the Reserve Bank of Australia (RBA) is likely to keep the cash rate - and thereby interest rates - high in the near term while it waits for inflation to return to its target range (2% to 3%).
So, with all that considered, let's dive into the market moves you'll want to know about if you're considering taking out a new home loan or refinancing your existing one.
CommBank unveils online-only home loan product
The home loan lineup from Australia's largest bank has a new entrant, and it bears the lowest advertised rate of all its products.
CommBank's new Digi Home Loan boasts advertised rates starting at 6.15% p.a. (6.28% p.a. comparison rate*).
There is a catch, however. The product is only available to those who already have a home loan at another bank, and who apply through the bank's own channels (online or through its app).
It's CommBank's first foray into the world of digital home loans. That is, if you don't count CommBank-owned Unloan, which launched in 2022.
Read more: CommBank launches digital-only home loan with rates from 6.15% p.a.
BCU Bank drops variable rates (even on offset products)
Horizon Bank cut variable home loan rates last week. This week, it was the turn of fellow mutual BCU Bank.
And it wasn't just BCU's bare-basic OMG home loan product that got a haircut. It also shaved as much as six basis points off its offset home loan offering.
Check out these new rates available to owner-occupiers making principal and interest (P&I) repayments:
|
Product |
LVR |
Change |
New rate (% p.a.) |
Comparison rate* (% p.a.) |
|
OMG Variable |
60-80% |
-5bp |
6.04% |
6.02% |
|
Offset Home Loan |
60-80% |
-6bp |
6.23% |
6.26% |
|
Offset Home Loan |
≤60% |
-5bp |
6.14% |
6.17% |
The Capricornian slashes one-year fixed rate to below 6%
We didn't see any more variable rates drop below the coveted 6% p.a. mark this week. Though, one market participant did cut its fixed rate product to such levels.
That was Central Queensland-based credit union The Capricornian.
It slashed 30 basis points off the advertised interest rate on its Premium Choice home loan product for owner-occupiers who fixed their rate for one year to 5.99% p.a. (7.34% p.a. comparison rate*).
If you're in the camp of people who believe interest rates could rise further in 2024, that might be a tempting deal.
Qudos Bank lowers fixed rates on home loans
Finally, if you're in the market for a longer fixed rate period, Qudos Bank cut rates on some of its four- and five-year products by up to 20 basis points this week.
The new rates are available to borrowers with LVRs of between 80% and 90%. Changes included:
|
Product |
LVR |
Change |
New rate (% p.a.) |
Comparison rate* (% p.a.) |
|
Owner occupier, P&I, four years fixed |
80-90% |
-15bp |
6.44% |
6.34% |
|
Owner occupier, P&I, five years fixed |
80-90% |
-20bp |
6.44% |
6.36% |
|
Investor, P&I, four years fixed |
80-90% |
-15bp |
6.74% |
6.58% |
|
Investor, P&I, five years fixed |
80-90% |
-20bp |
6.74% |
6.60% |
Image by Florian Schmidinger on Unsplash
Share