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Fixed-rate home loan demand has bounced back after hitting a four-year low in October.
According to the latest national home loan approval data from Mortgage Choice, fixed-rate mortgages accounted for 17.39 per cent of all loans written in November – up from 13.88 per cent the month prior.
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Mortgage Choice chief executive officer John Flavell said the bounce back wasn’t surprising given that most of Australia’s lenders have recently increased the interest rates across their suite of variable home loan products.
“The interest rate increases were made outside of any movements by the Reserve Bank of Australia, which sent shockwaves through existing and potential buyers,” Mr Flavell added.
“As a result of those rate hikes, an increasing number of new buyers are looking to fix at least part of their mortgage as they seek out security and surety around their mortgage repayments.”
Looking at the states and territories, fixed-rate demand was strongest in New South Wales, with this type of product accounting for 24.59 per cent of all loans written in November.
This was followed by Western Australia and Queensland, with fixed-rate demand accounting for 16.81 per cent and 15.83 per cent of all loans written, respectively.
Fixed-rate demand was lowest in South Australia and Victoria, with this type of product accounting for 12.37 per cent and 8.89 per cent of all loans written, respectively.
Of the variable-rate products, ongoing discount rates continue to be the most popular among mortgage holders, with this type of product accounting for 51.78 per cent of all loans written in November.
Introductory rate products were once again the least popular at 0.45 per cent – down from 0.81 per cent in October.
