An online mortgage marketplace has warned Australian home owners of the “Uberfication of home loans” amidst out-of-cycle rate hikes, and suggested there will be “more to come in 2017”.
In the past few weeks, NAB and Suncorp have announced they will increase variable rates on new and existing residential investor home loans, while Commonwealth Bank and Westpac have increased rates on fixed term mortgages.
Recent analysis by RateCity.com.au, has found that more than 20 lenders have lifted their rates on 268 fixed products since November 1.
Online mortgage platform HashChing has likened the rate hikes to Uber’s structure of charging more at peak times of demand, with CEO Mandeep Sodhi adding that despite the Reserve Bank of Australia keeping rates on hold at 1.5 per cent, “the big four have cornered the Australian mortgage market” and left customers “vulnerable to their strict pricing regime”.
Mr Sodhi suggested that the major banks were putting shareholders’ interests ahead of their customers and “using customer apathy as an opportunity for out-of-cycle rate hikes”.
He said: “After a record period of low interest rates, sentiment is shifting and the big banks are starting the big squeeze on the hip pocket nerve.
“It’s high time this practice is called out for what it is… a plain and simple money grab. It’s surge pricing by stealth.”
Mr Sodhi suggested that customers visit more than just the big four banks to get the lowest rates.
He said: “[C]ustomers aren’t necessarily at the mercy of the big banks when it comes to home loan rates, and shopping around will result in tangible savings that can make a big difference to a household’s bottom line.
“Customers should vote with their wallets and shop around for a better deal,” he concluded.