Following the Reserve Bank’s cut in the cash rate made in response to the Coronavirus pandemic caused economic downturn, the official cash rate is now just 0.25%, the lowest it has been in 23 years.
Following the RBA’s announcement to cut the cash rate, the big four banks cut fixed home loan rates for 1, 2 and 3 years quite significantly.
Depending on the bank and whether you take a 1,2- or 3-year fixed rate, the rates are as low as 2.14% p.a.
Some of the lesser known minor financial institutions are the most competitive.
The new rates came into effect at the beginning of May.
Locking in a fixed rate could be a smart move as it removes anxiety concerning future variable interest rate increases which we may see once the pandemic caused economic crisis has passed.