Demand for fixed rate home loans has hit a nine month high in November as interest rates are widely expected to start increasing next year.
According to the latest national home loan approval data from Mortgage Choice, fixed rate home loans accounted for 26.98% of all loans written in November – up from 26.64% recorded the month before.
Mortgage Choice spokesperson Jessica Darnbrough said while rates are currently sitting at all-time lows, an increasing number of borrowers are looking for some certainty around their repayments.
“A growing number of borrowers are beginning to realise that while rates are low, they can’t stay this way forever. And as such, they are looking to fix their mortgage now while rates are sitting at historically low levels,” she said.
“Furthermore, a lot of lenders slashed the interest on their suite of fixed rate products at the end of July and we are finally starting to see the result of those rate movements coming through in our data.”
Across Australia, fixed rates were most popular in New South Wales, with this type of product accounting for more than one third (34.13%) of all loans written last month. Queensland wasn’t far behind, with fixed rates accounting for 28.65% of all loans written, while in South Australia, Victoria and Western Australia fixed rates made up 20.23%, 19.77% and 16.94% respectively.