In the last two months the Reserve Bank of Australia has announced not one, but TWO rate reductions!
Both times, the RBA cut rates by 25 basis points, amounting to a total reduction of 0.50%
But do you think the lenders have passed on the full rate reduction? Of course not…
So, we thought we would let you all know which lenders have been the most giving and which have been the most greedy.
The winners of the ‘Giving back to Home Buyers’ award are:
The winners of the ‘Giving back to Investors’ award is:
And the winners (or should we say losers) of the “Greedy lenders” award are:
- ME Bank…….coming in at a close second.
An industry fund backed lender. And we all thought industry funds were such pure companies beyond reproach, or did we!
Turning the Investment and Interest Only taps back on!
It is interesting to note that Westpac and Commonwealth Bank are first to move with increasing the discounts (reducing the rate you pay) on investment and interest only rates now. This is due to APRA’s removal of investment and interest only caps on lending, opening the door for banks to grow their investment books and stirring up some competition.
This is just the beginning for most – and if not all lenders – to follow suit soon.
Coupled with APRA reducing the assessment rate from 7.25% to now 5.50% (yes you read that correctly) or the rate you are paying plus 2.5%, we are witnessing the turning of the tide when it comes to opening up lending markets.
Rates are reducing and your borrowing capacity is increasing………significantly.
The flood gates have opened and it is only early days!
With access to funding becoming steadily easier, as predicted a couple of months ago and reinforced in the property results, we expect that we’ve hit the bottom of the property market and things will continue to start to pick up now. As responsible citizens, we hope the growth is at a steady rate that is sustainable.