Home News Aussies switch to fixed rate loans

Aussies switch to fixed rate loans

Font size :

A new survey from the Mortgage & Finance Association of Australia (MFAA) has revealed that fixed rate home loans are now more popular than variable rate loans among Australians.

The home finance survey found that 28.3% of Aussies are likely to choose a fixed rate loan compared to just 19.9% who would choose a variable rate loan, if they borrowed or refinanced in the next six months. Around 31.6% say they would hedge their bets and select a mixture of both variable and fixed rates in their loan.

Phil Naylor, chief executive, MFAA, said people are still cautious about interest rate rises, despite a much lower expectation of this now, compared to six months ago.

He said: "Coming off the back of three rate rises last year, most new home loan borrowers are choosing the security of a fixed rate home loan, or opting for a split loan to maintain flexibility and hedge their bets against changes in interest rates."

He added that 39.2% of respondents believed interest rates would remain the same in the next quarter, but consumers were still seeking certainty by locking in rates.

The survey also researched the amount of income people were putting into their home loans each month.

It found that the average amount of household income to go into a home loan was 31.9%, while 16.4% of people claim to put 45-54% of their income into a home loan.

Phil Colton, head of broker sales, BankWest, said: "With mortgage payments taking up a significant portion of household incomes, homebuyers appear to be exercising caution to safeguard against any changes."

With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now

Mortgage News and Articles

House prices return to more affordable levels in mining towns House prices return to more affordable levels in mining towns

While the end of the mining boom has had a negative impact on property prices, homes in the region have become more affordable Read more

Borrowers should anticipate a possible rate hike Borrowers should anticipate a possible rate hike Some experts advise borrowers to look for a fixed loan that allows extra repayments so that they can whittle down the balance sooner ... Read more

Why choosing the right mortgage is hard for first-home buyers Why choosing the right mortgage is hard for first-home buyers Many feel overwhelmed by the sheer range of products and interest rates on offer, a new survey reveals ... Read more

Mortgage applications drop in second quarter Mortgage applications drop in second quarter This marks the “beginning” of a downward trend, says Equifax executive ... Read more

More mortgage news and articles

Sponsored Links

Thursday, Jul 27, 2017
Top Featured Rates
Top Bank Rates

Get help choosing the right home loan

Whether you're a first homebuyer, looking to refinance, or investing, it's important to have the right loan for your needs. Just fill in a few details below and one of our trusted mortgage advisers will contact you.

A quick & easy way to find the right home loan
  • Purpose of mortgage
  • Household Income
    $
  • How much do you want to borrow?
    $
  • How much deposit do you have?
    $
  • How much is your house worth?
    $
  • How much do you still owe on your mortgage?
    $
  • What type of mortgage do you have?


  • How much is your new home?
    $
  • How much do you want to borrow?
    $
  • How soon do you want a mortgage?
Next
  • First name
  • Last name
  • Where do you live?
  • Phone number

Special Offers

Related Keywords