September RBA decision: Board leaves cash rate on hold

At the Reserve Bank of Australia meeting today, the Board decided to leave the official cash rate on hold at a steady 2% for September.

The news comes after volatility in the Chinese sharemarket, which affected markets around the world.

While the RBA could have met this market drop by cutting the official cash rate in attempt to stimulate the economy, experts have indicated that the decision to keep the cash rate on hold is to see how the Australian economy pans out in the months to come.

Governor Glenn Stevens said in a statement, “Equity markets have been considerably more volatile of late, associated with developments in China, though other financial markets have been relatively stable."

“In Australia, most of the available information suggests that moderate expansion in the economy continues. While growth has been somewhat below longer-term averages for some time, it has been accompanied with somewhat stronger growth of employment and a steady rate of unemployment over the past year...In such circumstances, monetary policy needs to be accommodative. Low interest rates are acting to support borrowing and spending."

Owner occupier home loan heaven

While last RBA we reported a large number of lenders increasing interest rates and LVR requirements for investors - in an attempt to bring down their investor loan books as requested by APRA - over August we saw lenders take things a step further by introducing rate cuts for owner occupiers (i.e borrowers who plan to live in their home).

For instance, the following lenders have introduced a range of interest rate cuts for owner occupiers:

- HSBC has slashed its Home Value Loan from 4.23% to 3.99% 

- Greater Building Society has introduced a Great Rate offer of 4.09% for loans over $150,000, with an LVR up to 80%

- Heritage Bank has dropped its Discount Variable Home loan from 4.19% to 4.14%

- Mortgage House’s Advantage Home Loan Special rate has decreased by 4 basis points, bringing it down to 3.95% (loans over $350,000 and LVR less than 80%)

The best rates in the market, are the same as last month and are once again only available to owner occupiers:

- Mortgage House (owner occupier with LVR up to 50%) takes out the top spot for best rate at 3.89% with its Pure & Simple Variable Home Loan

- Homestar’s Basic Refinance Loan follows closely behind with a rate of just 3.94%, as long as you have an LVR below 70%

- If you want to borrow up to 95% of the property value, Homestar also has a competitive rate for owner occupiers of 3.98% attached to its Variable Rate Loan

While there are plenty of great deals for owner occupiers, if you’re an investor you can still grab a competitive mortgage package. Simply head on over to our investment loan section to compare offers today. Alternatively, if you want to compare our entire database, punch in your numbers into our home loan comparison tool.

Savings account saviours

With the low interest rate environment, ongoing savings account rates continue to sit below the 4% mark. RAMS’ Saver takes out the top spot offering 3.60% if you don't make any withdrawals and deposit at least $200 each month, followed closely by ING DIRECT who offers 3.50% with its Savings Maximiser, if you have a linked Orange Everyday Account and deposit at least $1,000 a month.

When it comes to intro rate offers, the best rate is offered by RaboDirect at 3.50% with its High Interest Saver, also recently matched by St.George/Bank of Melbourne/BankSA who have hiked up their Maxi Saver honeymoon rate by 30 basis points to 3.50%.

Want to see what other competitive savings account deals are available? Then stop by our savings account hub to compare our entire database.

Read last month's Reserve Bank interest rates update.

Top home loans - last updated 4 March 2024

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    Owner Occupier, Principal & Interest

    interest rate
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    5.80% p.a.
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* WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan. The comparison rate displayed is for a secured loan with monthly principal and interest repayments for $150,000 over 25 years.

** Initial monthly repayment figures are estimates only, based on the advertised rate. You can change the loan amount and term in the input boxes at the top of this table. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

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