Demand for fixed rates rising as rates fall
Demand for fixed rates is rising, according to research by Loan Market. Since the Reserve Bank of Australia’s May rate cut, 40 per cent of homeowner enquires have been about fixing the borrower’s interest rate, the highest proportion since the start of 2013.
“There’s been a roller coaster of speculation [about] when we’ll hit the bottom of the interest rate cycle and the latest RBA rate cut has caused lenders to drop their fixed rates even further as they expect the cash rate to drop again,” Mr Smith said.
“Fixed rates continue to be priced below variable rates and have been so for nearly 12 months now. It’s a trend that’s against the historical comparison of fixed and variable rates.”
Source: The Adviser