The good news is that they appear to be on the way down and are likely remain low for some time if the recent Reserve Bank commentary is anything to go by. We’re already starting to see the affect this is having on demand for new homes.
This comes after the ANZ cut their standard variable mortgage rate by 0.27 of a percentage point on May 10. It’s a significant move, as not only is it greater than the Reserves Bank’s 0.25 percentage point cut to the cash rate, it’s the first time in 16 years that a major bank has cut more than the central bank.
NAB, CBA and Westpac all matched the central bank’s cut however ANZ’s move is likely to stir greater competition amongst the big four banks, especially considering the NAB has campaigned on having the lowest rate amongst the big four for some time.
On Tuesday, the RBA flagged the potential for further rate cuts after commenting in its May board meeting minutes that it had used “some of the scope to ease policy”. So, even though the cash rate is already at a record low of 2.75 per cent this month, it could potentially go lower still over the course of 2013.
Organising your home finance can be confusing and if you need help the Blueprint team is ready to assist. Learn more by visiting our finance page. You can apply online or give us a call. We’ll even assist you to access the First Home Owners Grant if you’re a first homebuyer.
– Craig Park