Lenders continue to hike home loan rates
A wave of home loan rate changes has continued in the lead-up to today’s Reserve Bank decision.
Lenders have made a raft of rate changes ahead of today’s RBA board meeting, with both fixed and variable rates rising in recent weeks. Westpac and NAB have now hit investors with rate rises, even as the Reserve Bank is tipped to leave the official cash rate on hold.
NAB announced it would lift variable rates on new and existing residential investor loans by 15 basis points from 5.4% to 5.55%, the Australian reported. The change will come into effect from 12 December.
“As was evident during the recent bank reporting season, net interest margins — the difference between what we pay to borrow funds to lend to our customers and what our customers pay — are down, particularly in home lending, and they remain under pressure,” NAB chief operating officer Antony Cahill said.
Cahill said a low-rate environment was proving challenging to lenders, and defended the rise as a response to economic conditions.
Westpac also moved investor rates higher, the Australian reported. The bank announced its owner-occupier interest-only variable rate would rise by 8 basis points to 5.41%, while its investor rate would rise by 8 basis points to 5.68% and its equity access loan would rise 15 basis points to 5.80%. The changes are set to come into effect from 16 December.
Newcastle Permanent, meanwhile, announced it would lift fixed rates for the third time in a week. The lender raised fixed rates on 1 December and again on 5 December, and will lift rates again from tomorrow. The changes take the lender’s four and five year fixed rates for owner-occupiers a total of 1% higher and the four and five year investor fixed rates 1.27% higher.
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