Owner-occupied properties are now subject to a 0.05 percent increase in variable interest rates. Meanwhile, investment properties have seen a steeper climb of 0.1 percent in their variable rates. These adjustments reflect a changing landscape in the housing finance sector as banks begin to recalibrate their offerings.
On the brighter side for future homeowners and investors, Ubank has sliced rates on short and long-term fixed-rate loans. The one-year fixed mortgage rate has significantly dropped by 0.35 percent, from a previous rate of 7.04 percent, settling now at 6.69 percent. For those looking more long-term, a reduction of 0.49 percent has been applied to the five-year fixed loans, resting at a new rate of 6.55 percent.
These updated rates will be available for all applications that reach an unconditionally approved status on or after March 14. This date precurses the RBA board's upcoming meeting scheduled for March 18 and 19. Predictions are swirling that the RBA will opt to maintain the current cash rate at 4.35 percent, though this remains to be seen.
Recent financial assessments from Commonwealth Bank, Australia's most sizeable lending institution, provide context on the gravity of these rate hikes for the average consumer. Over the past 12 months, ending in December, home loan costs surged by nearly 40 percent, indicating a substantial financial burden on borrowers. Impressively, since the dip witnessed during the COVID-19 pandemic, there has been a staggering increase of 162 percent in mortgage outlays, underscoring the significant turnaround from the previous economic environment.
