ANZ has hiked fixed rates by up to 0.9 percentage points, following a similar move from Westpac.
Westpac increased its fixed rates by 0.5 percentage points for customers looking to lock in their rate.
“ANZ and Westpac have fired off yet another round of hikes as the cost of fixed-rate funding continues to rise, alongside market expectations the cash rate could hit 4%,” said Sally Tindall, RateCity.com.au research director. “We’ve now got fixed rates for owner-occupiers starting with a ‘5’ and in some cases a ‘6.’”
RateCity.com.au analysis showed the majority of ANZ’s owner-occupier fixed rates have risen by 3.5 percentage points or more in the last 12 months. One of the biggest rises has been to the bank’s three-year fixed rate, which has shot up by 3.85 percentage points in less than a year.
RateCity.com.au showed ANZ owner-occupier principal and principal fixed rate changes:
|
Term
|
Old rate
|
New rate
|
Change
|
|---|---|---|---|
|
1-yr fixed
|
3.79%
|
4.69%
|
0.9%
|
|
2-yr fixed
|
4.59%
|
5.49%
|
0.9%
|
|
3-yr fixed
|
4.99%
|
5.89%
|
0.9%
|
|
4-yr fixed
|
5.09%
|
5.99%
|
0.9%
|
|
5-yr fixed
|
5.19%
|
6.09%
|
0.9%
|
Note: Above rates are for owner-occupiers paying principal and interest on a package rate with a loan-to-value ratio of 80% or less.
With the Reserve Bank considering further cash rate hikes, home loan borrowers are in for more mortgage pain.
“The RBA is ripping the low-rate band-aid off, and quickly. For many Australians it’s going to sting,” Tindall said. “Variable rate borrowers should prepare themselves for another double hike in July and for the cash rate to rise above 2% by Christmas – potentially well above this mark. Households with savings buffers in place and pay rises under their belts should be able to adjust to a more normal rate environment without too much grief. However, there will be plenty of families who will soon find it difficult to balance the monthly budget, particularly if the cost of living continues to spike, as it’s expected to do.”
For those who think they won’t be able to make ends meet by Christmas, Tindall urged them to “start making changes now.”
“Review all your regular bills and expenses to see where you can make cutbacks, or potentially switch to a more competitive deal,” she said. “If you can’t see a path through, put up your hand and ask for help. There are experts that can provide free financial advice to help you chart a course through these difficult financial times.”
