August home loan snapshot: Cashback deals, green loans and new variable rate lows

If you needed proof that competition is running hot for Australian mortgage holders, the last few weeks has done just that, as lenders have taken their knives to home loan rates once again.

Online lenders have led the charge, reducing their variable rates offers to the point that some now feature a rate starting with a ‘1’. But these rate cuts haven’t been the only thing grabbing the headlines recently, as a host of new cashback deals and green home loans have also hit the market.

So for a round up of the latest rate changes and new offers, plus a look at the lowest rates currently in our database as, read on.

Latest rate changes 

As mentioned above, most of the notable changes in the past month have come from lenders making cuts to their variable home loan rates. In fact, there were enough cuts registered last month to push the average variable rate for owner occupiers in the Mozo database to a new record low of 3.20% (since tracking began in 2015).

• AMP reduced the variable rate on its Essential Home Loan Special by 48bp to 2.29% (2.32% comparison rate*) for owner occupiers with an <80% LVR

• Macquarie took 10bp off of its Basic Home Loan for owner occupiers with an LVR below 80%, meaning the new variable rate is 2.39% (2.39% comparison rate*)

• Tic:Toc briefly grabbed the rate leading position in our database at the 80% LVR tier for owner occupiers after cutting 15bp off of its Variable Home Loan. The new rate is sitting at a super low 1.89% (1.90% comparison rate*)

• Well Home Loans reduced the rate on its Well Balanced loan for owner occupiers (<80% LVR) by 18bp, meaning its rate is now just 1.99% (2.02% comparison rate*)

Meanwhile, fixed rates are still seesawing, with lenders continuing to cut shorter term rates while lifting rates on longer terms. Some of the notable recent changes include:

• Citi reduced the 3-year rate on its Fixed Rate Loan by 10bp, meaning the new rate is 1.99% (4.42% comparison rate*) for owner occupiers with an <80% LVR

• Great Southern Bank took 20bp off of the 2-year rate on its Fixed Rate Loan, meaning the new rate for owner occupiers with an <80% LVR is 1.89% (4.04% comparison rate*)

• UBank added between 4 and 25bp to the 1, 3 and 5-year fixed rates on its UHomeLoan (Fixed) product for owner occupiers, though its rates remain some of the most competitive in our database

Lowest home loan rates

So how do those new rates from the lenders above compare to some of the lowest rates in our database? Here’s a look at what’s on offer for owner occupiers (P&I repayments, <80% LVR), though it’s also worth noting that there are even sharper rates on the market for borrowers with even lower LVRs.

Lowest variable rates - Mozo database (August 1, 2021)^^

Lowest fixed rates - Mozo database (August 1, 2021)^^

New cashback deals and green home loans

Beyond interest rate changes, several lenders also came out with new cashback deals in the past month, though perhaps even more interesting is the launch of a number of new green home loans. Until now, only a handful of lenders have released dedicated green home loan products, though it's a trend we’re likely to see increase in the months and years ahead. 

Cashback deals

• Suncorp launched a new $3,000 cashback offer for refinancers looking to switch a loan of at least $750,000 (max. 90% LVR) to an eligible Suncorp home loan

• ING announced cashback deal of $3,000 cashback deal for refinancers who are willing to switch an existing loan of $500,000+ (max. 80% LVR) from another lender

Green loans

• Last month loans.com.au launched its Green Home Loan which offers borrowers a discounted rate if their home has a 7.0 star rating or higher under the Nationwide House Energy Rating Scheme (NatHERS).

• Non-bank lender Firstmac is also incentivising borrowers ‘green homes’, offering a 0.40% rate discount to borrowers with homes rated 7.0 stars or more under the NatHER Scheme.

• Announced earlier this year, the Commonwealth Bank recently rolled out its Green Loan to customers across the country. While it’s not a home loan, the Green Loan will only be available to mortgage customers and it can be used to purchase items like solar panels, battery packs and electric vehicle chargers.

RELATED: Top Green Home Loans in Australia

Time to make the most of the low interest rates on offer from many lenders? Get started today by browsing through the rates, fees and features available on different loans using the handy Mozo home loan comparison tables.

^^Interest rates are based on an owner occupier making principal and interest repayments on a $400,000 loan with an 80% LVR. For more information on average mortgage rates, check out our dedicated Australian home loan statistics page.