Predictions for Further Rates Cuts Boosts Variable Rate Loans
It is expected by many consumers that RBA will make further rate cuts in the coming month this year, as RBA governor have mentioned this thing in his previous statements that the further rate cuts will be there if required.
This prediction makes more Aussies attracted towards variable rate loans. Home loan approval data released by Mortgage Choice shows that throughout all the loans written the percentage of variable rate loans was 82.47 per cent, whereas in the last month it was 81.83 per cent.
Mortgage Choice chief executive officer John Flavell says, “The slight lift in variable rate demand isn’t surprising given that the Reserve Bank continues to make it clear that it will cut rates “as necessary”.
According to him, the combination of low consumer sentiment and below-trend growth is encouraging the Reserve Bank to contemplate their current stance on monetary policy.
It may be case that RBA will not make further rate cuts but it is expected that the rates will not rise further, he commented.
If we talk about the interest of Aussies in variable rate loans in different areas, the percentage in WA and Victoria is 91.55 per cent and 88.6 per cent respectively.
Flavell further added, “Moving forward, the level of fixed rate demand will continue to be determined by what happens at the Reserve Bank’s Board meeting and their cash rate commentary”.
News Source: http://www.brokernews.com.au/news/breaking-news/variable-rate-demand-climbs-as-consumers-bet-on-rate-cut-202302.aspx