A non-major has slashed home loan rates across both its owner-occupied and investment products.
Bankwest has cut its fixed mortgage rates by up to 125 bps, effective from Friday, 24 January.
The changes apply to both Bankwest’s owner-occupied and investment home loans for borrowers with principal and interest (P&I) or interest-only (IO) loan terms.
- P&I fixed rates have been cut by up to 125 bps, and now start from 2.93 per cent (3.84 per cent comparison rate).
- IO fixed rates have been cut by up to 71 bps, and now start from 3.79 per cent (4.03 per cent comparison rate).
- P&I fixed rates have been cut by up to 120 bps, and now start from 3.29 per cent (4.36 per cent comparison rate).
- IO fixed rates have been cut by up to 95 bps, and now start from 3.49 per cent (4.39 per cent comparison rate).
Bankwest’s changes come just days after Westpac repriced its fixed rate home loan offerings, lowering them by up to 50 bps.
Following Bankwest’s announcement, Steve Mickenbecker, rate comparison site Canstar’s finance analyst, observed that the rate cuts are yet another sign of heightened competition in the market.
“Competition is heating up in the home loan market, with lenders jostling for market share, even in the face of low margins,” he said.
Mr Mickenbecker added that Bankwest’s changes also reflect a resurgent appetite for investor credit.
“The decreases to Bankwest’s investment lending rates suggest a rethink and repositioning,” he said.
“Bankwest’s investment loan pricing is now below or at parity with owner-occupied for interest-only lending, perhaps recognition of the legitimacy of this strategy for investors.”
Bankwest’s reductions come just weeks ahead of the Reserve Bank of Australia’s (RBA) next monetary policy board meeting.
An additional 25 bps reduction to the cash rate would place further downward pressure on mortgage rates, with the RBA’s previous cuts prompting lenders to reprice their offerings.
The RBA’s monetary policy board will next meet to determine the cash rate on Tuesday, 4 February.