15 March 2018
The Australian Banking Association welcomes today’s ACCC interim report into residential mortgages, which clearly shows very high levels of discounting in the Australian home loan market. It’s clear that competition is delivering better deals for customers, shopping around works and Australians should continue to do so to get the best discounts on the advertised rate.
The report itself states that “an overwhelming majority of borrowers with variable rate residential mortgages at the Inquiry Banks were paying interest rates significantly lower than the relevant headline rate” (the advertised rate). Discounts on home loans ranged between .78% and 1.39% below the relevant headline interest rate.
The advertised variable discount rate for home buyers today is 4.5%, close to the lowest ever recorded.
Data from APRA1 and Canstar further illustrates there is strong competition in the home loan market, with over 140 providers, offering over 4,000 home loan products. Truly a vast and competitive market for Australians to choose a home loan.
Other evidence shows that Australians are taking advantage of this competitive market and are shopping around. Research by Galaxy shows that:
- 3 million people had switched banks over the last three years.
- Of those who had switched banks over the last three years, two-thirds (68 per cent) found that switching was an easy process.
ENDS
Contact: Rory Grant 0475 741 007
1 http://www.rba.gov.au/fin-stability/fin-inst/main-types-of-financial-institutions.html
Latest news
Tom Connell Those people with a home loan who have had a fixed rate are getting a shock as they come off that fixed rate. Often as low as two percent and onto the new variable rate that can be as high as six or even seven percent. So how is that affecting people out… Read more »
Australians facing difficult financial decisions are being reminded to get in touch with their bank and get the support they need to keep repayments on track. The Australian Banking Association (ABA) is extending its ‘don’t tough it out on your own’ campaign which was launched last year, with a further round of advertisements to run… Read more »
Steve Austin Well as you know, the Commonwealth Government has made it clear they consider access to cash a priority for the Australian economy and the country’s largest banks, as well as Coles, Woolworths, companies like Wesfarmers and Australia Post have been trying to put together a short term lifeline for Armaguard, who’s the company… Read more »