A study has found more Australians are likely to start fixing their home loans, despite the stable cash rate, as they anticipate the wake of imminent interest rate hikes next year.
The new poll by comparison website finder.com.au said all 34 industry experts and economists who served as respondents believe the cash rate would remain on hold at 2% on 2 June. Finder.com.au added it has been six months since the panellists expressed unanimous cash rate forecasts.
About one in three experts are expecting another cut by the Reserve Bank of Australia before the year ends, or by July. A total of 21, however, said there will be no additional cash rate moves this year.
Michelle Hutchison, Money Expert at finder.com.au, also predicts more borrowers will start to lock in fixed home loan rates.
"The majority of experts from the Survey (82%) are expecting to see more borrowers concerned about rising interest rates
and lock in a fixed rate home loan. Of these experts, 21 of which are expecting this will happen this year, while seven don't think more borrowers will fix until next year. There were also four experts who don't think more borrowers will fix at all,” she said in a release.
"While it is a good idea to fix your home loan if you're concerned that rates will rise, it's a worry that some experts don't think more borrowers will fix. We're seeing record low numbers of borrowers fixing their home loans and as prices rise and rate hikes on the horizon, some borrowers will be under financial strain if they don't consider fixing while rates are low.”
It can be confusing to know whether to get a variable rate or fixed rate mortgage, and what features are important. That's why it's important to not only check the right rates, but make sure that you're getting the right features in your home loan. Get help choosing the right home loan