Fixed-rate home loan demand steadies

Friday 11 February 2011

Article by Mozo

The demand for fixed-rate home loans steadied last month, suggesting borrowers are less concerned about interest rate rises at present.

Fixed-rate home loan demand steadies

New data from Mortgage Choice, the country's largest independently-owned mortgage broker, shows that 15.3 per cent of the home loans approved for its customers in January had a fixed interest rate.

While this remains higher than the last couple of years, the figure also points to slowing growth in the fixed-rate mortgage market.

According to Mortgage Choice, 15.2 per cent chose to fix rates in December, 11.2 per cent in November, 7.7 per cent in October and 3.7 per cent in September.

The data suggests fears about rising interest rates may be waning among people looking to compare home loans.

"Australians' appetite for fixed rate home loans has risen consistently over the past six months, but that pace slowed right down in January," said Mortgage Choice company spokesperson Kristy Sheppard.

"One has to question whether the demand for this more conservative loan type has steadied now it looks likely that the next cash rate rise has been pushed back to mid-year or later."

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