Home loans customers 'should expect rate rise'
Those searching for low interest home loans have been told prices may rise as a result of a lack of competition.
University of New South Wales professor Frank Zumba recently addressed the senate’s inquiry into bank mergers and suggested the unions had a negative effect on the market, the Herald Sun reported.
"It is far easier for the remaining firms to act as a cosy club for their self-interested advantage rather than to aggressively attack one another on price or other terms and conditions," the newspaper quoted him as saying.
The article highlighted the intention of Commonwealth Bank Australia to increase its mortgage rates, with a spokesperson for the lender explaining the decision was tied to the cost of funding.
Loan Market Group executive director John Kolenda stated homeowners should be paying off as much of their mortgage as possible, as rates are likely to rise.
The Reserve Bank of Australia has revealed it is not considering any more rate cute – an announcement that could stoke fears over rate rises.
A recent article in the Daily Telegraph suggested there is still money to be made in the property business if home loans customers are savvy.
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