It was actually a relatively quiet week for home loan rate changes after Macquarie, HSBC and Bank Australia were among several to cut last week.

The past couple of months have seen a mostly uninterrupted stream of rate cuts, and promising signs for plenty of new mortgage holders

Around the start of August, Australian Government bond yields dropped significantly, suggesting investors are anticipating cuts to the RBA cash rate sooner rather than later.

This lowers banks' costs of funding, particularly in the medium term, so lenders have been able to cut rates significantly to attract new customers.

However, the week past also saw bond yields climb back up again - the annual return on three year bonds is back up around 3.8% as of October 10, compared to 3.4% in September, so it isn't a guarantee that the home loan rate slashing will continue.

In any case, here are the major rate changes from the week ending 11 October.

ANZ joins sub-6% club

Product Rate Change
OO Fixed 1 Year 80% Down 30 bps to 6.39% p.a. (7.15% p.a. comparison rate*)
OO Fixed 2 Year 80% Down 55 bps to 5.99% p.a. (6.99% p.a. comparison rate*)
OO Fixed 3 Year 80% Down 60 bps to 5.99% p.a. (6.88% p.a. comparison rate*)
OO Fixed 4 Year 80% Down 60 bps to 6.14% p.a. (6.84% p.a. comparison rate*)
OO Fixed 5 Year 80% Down 60 bps to 6.24% p.a. (6.80% p.a. comparison rate*)
Inv Fixed 1 Year 80% Down 40 bps to 6.49% p.a. (7.70% p.a. comparison rate*)
Inv Fixed 2 Year 80% Down 50 bps to 6.19% p.a. (7.50% p.a. comparison rate*)
Inv Fixed 3 Year 80% Down 50 bps to 6.19% p.a. (7.39% p.a. comparison rate*)
Inv Fixed 4 Year 80% Down 70 bps to 6.24% p.a. (7.24% p.a. comparison rate*)
Inv Fixed 5 Year 80% Down 70 bps to 6.34% p.a. (7.17% p.a. comparison rate*)

At long last ANZ has joined the cutting party after radio silence for a while, even after its major bank peers have been busy cutting rates.

The lowest rates in this round of cuts apply to 2- and 3-year fixed rates for owner occupiers. 

The biggest cuts, however, applied to investor loans, fixed for 4- and 5-years. 

It's interesting having two major banks cut fixed rates in the same week; this makes it easier to directly compare. 

This likely isn't the end of the story, however; major banks are generally more prolific in offering tailored rates to the borrower with further discounting available.

NAB cuts fixed rates for owner occupiers...

Product Rate Change
One year fixed (LVR 70-80%) Down 40 bps to 6.34% p.a. (7.00% p.a. comparison rate*)
Two year fixed (LVR 70-80%) Down 55 bps to 6.09% p.a. (6.89% p.a. comparison rate*)
Three year fixed (LVR 70-80%) Down 10 bps to 5.94% p.a. (6.77% p.a. comparison rate*)
Four year fixed (LVR 70-80%) Down 50 bps to 6.29% p.a. (6.81% p.a. comparison rate*)
Five year fixed (LVR 70-80%) Down 50 bps to 6.34% p.a. (6.79% p.a. comparison rate*)
One year fixed (LVR 60-70%) Down 40 bps to 6.29% p.a. (6.82% p.a. comparison rate*)
Two year fixed (LVR 60-70%) Down 55 bps to 6.04% p.a. (6.72% p.a. comparison rate*)
Three year fixed (LVR 60-70%) Down 10 bps to 5.89% p.a. (6.62% p.a. comparison rate*)
Four year fixed (LVR 60-70%) Down 50 bps to 6.24% p.a. (6.67% p.a. comparison rate*)
Five year fixed (LVR 60-70%) Down 50 bps to 6.29% p.a. (6.65% p.a. comparison rate*)

NAB was the biggest mover this week, slashing fixed rates for both owner occupiers and investors.

It's the second cut from NAB in this cycle after it cut fixed rates in July - becoming the first of the big four to offer fixed rates below 6%.

This most recent cut means NAB is in line with Westpac and CommBank with the lowest fixed rate on offer for owner occupiers at 5.89% p.a, although the comparison rate on the NAB product is lower, suggesting lower fees or revert rates.

...and for investors

Product Rate Change
Investment Tailored Fixed P&I 1 yr (LVR 60-70%) Down 40 bps to 6.44% p.a. (7.10% p.a. comparison rate*)
Investment Tailored Fixed P&I 2 yrs (LVR 60-70%) Down 50 bps to 6.24% p.a. (7.00% p.a. comparison rate*)
Investment Tailored Fixed P&I 3 yrs (LVR 60-70%) Down 65 bps to 6.09% p.a. (6.88% p.a. comparison rate*)
Investment Tailored Fixed P&I 4 yrs (LVR 60-70%) Down 40 bps to 6.44% p.a. (6.93% p.a. comparison rate*)
Investment Tailored Fixed P&I 5 yrs (LVR 60-70%) Down 40 bps to 6.49% p.a. (6.91% p.a. comparison rate*)
Investment Tailored Fixed P&I 1 yr (LVR 70-80%) Down 40 bps to 6.49% p.a. (7.29% p.a. comparison rate*)
Investment Tailored Fixed P&I 2 yrs (LVR 70-80%) Down 50 bps to 6.29% p.a. (7.17% p.a. comparison rate*)
Investment Tailored Fixed P&I 3 yrs (LVR 70-80%) Down 65 bps to 6.14% p.a. (7.04% p.a. comparison rate*)
Investment Tailored Fixed P&I 4 yrs (LVR 70-80%) Down 40 bps to 6.49% p.a. (7.07% p.a. comparison rate*)
Investment Tailored Fixed P&I 5 yrs (LVR 70-80%) Down 40 bps to 6.54% p.a. (7.04% p.a. comparison rate*)
Investment Tailored Fixed P&I 1 yr (LVR >80%) Down 40 bps to 6.49% p.a. (7.29% p.a. comparison rate*)
Investment Tailored Fixed P&I 2 yrs (LVR >80%) Down 50 bps to 6.29% p.a. (7.17% p.a. comparison rate*)
Investment Tailored Fixed P&I 3 yrs (LVR >80%) Down 65 bps to 6.14% p.a. (7.04% p.a. comparison rate*)
Investment Tailored Fixed P&I 4 yrs (LVR >80%) Down 40 bps to 6.49% p.a. (7.07% p.a. comparison rate*)
Investment Tailored Fixed P&I 5 yrs (LVR >80%) Down 40 bps to 6.54% p.a. (7.04% p.a. comparison rate*)

People's Choice cuts fixed rates

Product Rate Change
Residential Fixed P&I 1 yr Down 25 bps to 6.09% p.a. (8.60% p.a. comparison rate*)
Residential Fixed P&I 2 yrs Down 20 bps to 5.99% p.a. (8.31% p.a. comparison rate*)
Residential Fixed P&I 3 yrs Down 40 bps to 5.69% p.a. (7.97% p.a. comparison rate*)
Residential Fixed P&I 4 yrs Down 50 bps to 5.69% p.a. (7.73% p.a. comparison rate*)
Residential Fixed P&I 5 yrs Down 50 bps to 5.69% p.a. (7.51% p.a. comparison rate*)

Other movers

  • Heritage Bank cut fixed rates up to 50 bps
  • Queensland Country Bank varied rates up to 90 bps
  • Beyond Bank varied rates up to 50 bps
  • Community First cut special offer three year fixed rates 10 bps
  • AusWide Bank cut variable rates up to 20 bps

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Looking for a fixed rate home loan? Here are some of the top rates available in Australia at the moment

Picture from NAB



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