Getting a Mortgage in Australia

Current Australian Mortgage Rates:

Variable Interest Rates

A few Mortgage Interest rates checked in August 2010

6.29% Reduce Home Loans
6.39% State Custodians
6.43% Ratebusters
6.47% HomeStar
6.59% Homeloans Limited
6.63% MyRate

Interest rate review Tuesday 6th July 2010

6th July 2010
At its meeting today, the Reserve Bank of Australia decided to leave the cash rate unchanged at 4.5 per cent.

Interest rate review Tuesday 1st June 2010

1 June 2010
At its meeting today, the Reserve Bank of Australia decided to leave the cash rate unchanged at 4.5 per cent.

Interest rate change Tuesday 4th May 2010

The Reserve Bank of Australia increased Interest rates by 0.25% on 4th May 2010

Expected Bank Mortgage rates will now be:

• 6.86% CBA Economiser Base Variable Rate (up 0.25%)
  
• 6.71% ANZ Simplicity PLUS (up 0.25%)
  
• 6.74% NAB Base Variable Rate Home Loan (up 0.25%)
  
• 6.81% Westpac Low rate basic home loan (up 0.25%)
  

Interest rate change Tuesday 6th April 2010

The Reserve Bank of Australia increased Interest rates by 0.25% on 6th April 2010

The new Base rate is now 4.25%

The main Bank reactions so far are:

• 7.11% CBA standard variable mortgage (up 0.25%)
  
• 7.16% ANZ standard variable mortgage (up 0.25%)
  

Some of the best mortgage rates being quoted (at 12 April 2010) are:

• 6.13% Myrate (ING Bank funded)
  
• 6.86% Commonwealth
  
• 6.91% ANZ
  
• 6.93% St. George
  
• 7.01% Westpac
  

Interest rate change Tuesday 2nd March 2010

The Reserve Bank of Australia increased Interest rates by 0.25% on 2nd March 2010

The new Base rate is now 4.00%

Interest rate change Tuesday 1st December 2009

The Reserve Bank of Australia increased Interest rates by 0.25% on 1st December 2009

The new Base rate is now 3.75%

The big Four Banks, in Feb 2010 are now quoting the following rates for their Standard Variable Rate Home loans.

• 6.28% NAB
  
• 6.61% CBA
  
• 6.66% ANZ
  
• 6.68% St George
  
• 6.76% Westpac
  

As at November 3rd 2009, the RBA increased the base Interest rates by 0.25% to 3.50%

The banks immediately passed this increase on, and the CBA Standard Variable Home loan rate will become 6.24% on Monday 9th November.

The big Four Banks, in November 2009 began to quote the following rates for their Standard Variable Rate Home loans.

• 6.24% NAB
  
• 6.24% CBA
  
• 6.31% ANZ
  
• 6.31% Westpac
  

As at October 6th 2009, the RBA increased the base Interest rates by 0.25% to 3.25%

If the banks pass this on, as is, the CBA Standard Variable Home loan rate will become 5.99%

The big Four Banks, in October 2009 began to quote the following rates for their Standard Variable Rate Home loans.

• 5.99% NAB
  
• 5.99% CBA
  
• 6.06% ANZ
  
• 6.06% Westpac
  

The above rates came into effect in the week starting 12th October 2009

Fixed Interest Mortgage Rates

5 Year Fixed rates

3 Year Fixed Rates at September 2009:

• 6.69% NAB
  
• 6.99% ANZ
  
• 7.19% Westpac
  
• 7.29% CBA
  

Fixed Rate Increases in August 2009

Westpac Bank announces that fixed rates will increase on the 4th August 2009 to:
5.59% 1 Year Fixed Rate
6.99% 3 Year Fixed Rate
7.64% 5 Year Fixed Rate

Other banks may follow after the RBA meeting

Heritage Building Society

6.29% June 2009 (?? Possible rises to come)
6.29% April 2009
6.29% Feb 2009

Commonwealth Bank Increases Variable Home Loan rate

12th June 2009

The Commonwealth Bank today increased its Standard variable home loan rate from 5.64% to to 5.74%.

The bank also confirmed that some home loans with fixed interest rates will also rise by a similar figure.

April 2009

7th April 2009 - RBA cuts Interest rates by 0.25%
The RBA has again cut interest rates by another 0.25% on the 7th April 2009.

This brings the official Interest rate down to 3%

BUT... the banks are not all reducing their Mortgage Interest rates this time

• CBA is cutting its rate by 0.10% down to 5.64%
• NAB is NOT cutting its rate and staying at 5.74%
• Westpac is cutting its rate by 0.10% down to 5.81%
• ANZ is cutting its rate by 0.1% down to 5.81%

The smaller banks and Building Societies ?

• Bendigo Bank is NOT cutting its rate
  
• Adelaide Bank is NOT cutting its rate
  
I have read that these will give the full 0.25% reduction, which would mean...

• Heritage Building Society down from 5.55% to 5.3%
  

Fixed Rate Mortgages

With interest rates now very low, it is time to watch the Fixed Rates, to see when they will begin to increase.
Some 5 Year Fixed Rate Mortgage examples to watch in the future:

• Heritage Building Society 6.29% at Feb 2009
  
• Commonwealth Bank 6.39% at March 2009
  
• St George Bank 5.94% at April 2009 (This was 8.4% in Feb 2008)
  
  

An example of one banks current fixed rates as at April 22nd 2009

1 Year Fixed 5.39% p.a.
2 Year Fixed 5.79% p.a.
3 Year Fixed 6.19% p.a.
4 Year Fixed 6.59% p.a.
5 Year Fixed 6.84% p.a.
7 Year Fixed 7.24% p.a.
10 Year Fixed 7.39% p.a.
15 Year Fixed 7.39% p.a.


and again at 15th June 2009 Fixed rates

1 Year Fixed 5.39% p.a.
2 Year Fixed 5.94% p.a.
3 Year Fixed 6.69% p.a.
4 Year Fixed 6.99% p.a.
5 Year Fixed 7.34% p.a.
7 Year Fixed 7.79% p.a.
10 Year Fixed 8.09% p.a.
15 Year Fixed 8.19% p.a.

February 2009

The Reserve Bank of Australia reduced Interest rates by 1% on 3rd February 2009

The following bank announcements have now been made about Mortgage Rate cuts:

• NAB is cutting its rate by 1.0% down to 5.74%
• CBA is cutting its rate by 1.0% down to 5.74%
• Bendigo Bank is cutting its rate by 0.9% down to 5.90%
• Adelaide Bank is cutting its rate by 0.9% down to 5.90%
• Westpac is cutting its rate by 1.0% down to 5.91%
• ANZ is cutting its rate by 1.0% down to 5.91%

Average Mortgages in Australia

According to AFG, Australia's largest Mortgage Broker, the July 2009 average mortgage for Australia was $354,137, and for each state the figures were:

$407,226 NSW
$339,840 QLD
$270,179 SA
$321,671 VIC
$382,225 WA
$370,518 NT

Loan Value ratios, as a percentage of property value, were between 63.3% and 71.1%

19.2% of all loans in July 2009 were for First Home Buyers, 34.6% for re-financing and 30% for property investors.

How Much Can you Borrow ?

That's a common question, so here are some links to help you find the answer, but don't forget to also read the next section, Credit Cards and Mortgages.

Most banks can discount their normal rates by about 0.7% to selected borrowers, it always pays to ask. You may be a "selected" borrower if your loan is over $250,000.

Mortgage Calculators

• ANZ - Loan Repayment Calculator
• CBA - Loan Repayment Calculator

But remember each bank will have its own calculator, based on THEIR lending policies, and may be different to the ones above.

Credit Cards and Mortgages

Mortgage lenders will take any Credit Card LIMITS into account when you apply for a Mortgage. So, if you can, pay off any balances, before applying, and have your card limit reduced to a few hundred $ only.

In my experience, if you pay off the balance at the end of each month, and therefore pay NO interest, the lender can often be convinced to ignore that cards credit limit, but you need to be able to prove it.

Most Bank Lenders will also offer you a credit card, effective after the mortgage is done, and that limit is ignored in the calculation.

Average Mortgages in Australia

NSW
In New South Wales, the average Home Loan in April 1979 was $25,400
In April 1989 it was $85,400, an increase of 218.1% over the previous 10 years.
In April 1999 it was $158,500 an increase of 96.16% over the previous 10 years.
In April 2009 it has become $283,300 an increase of 78.74% over the previous 10 years.
The NSW increase from 1979 to 2009 has been 1015.4%

VIC
In Victoria, the average Home Loan in April 1979 was $24,300
In April 1989 it was $68,400, an increase of 181.48% over the previous 10 years.
In April 1999 it was $123,500, an increase of 80.56% over the previous 10 years.
In April 2009 it has become $249,000, an increase of 101.62% over the previous 10 years.
The Victoria increase from 1979 to 2009 has been 924.7%

QLD
In Queensland, the average Home Loan in April 1979 was $21,700
In April 1989 it was $51,900, an increase of 139.17% over the previous 10 years.
In April 1999 it was $116,700, an increase of 124.86% over the previous 10 years.
In April 2009 it has become $270,800, an increase of 132.05% over the previous 10 years.
The Queensland increase from 1979 to 2009 has been 1147.9%

WA
In Western Australia the average Home Loan in April 1979 was $23,900
In April 1989 it was $54,500, an increase of 128.03% over the previous 10 years.
In April 1999 it was $115,900, an increase of 112.66% over the previous 10 years.
In April 2009 it has become $282,800, an increase of 144.00% over the previous 10 years.
The Western Australia increase from 1979 to 2009 has been 1083.3%

Average Mortgage compared to Average Wage

The following figures show the average Home Mortgage against the average Male Full time wage for April 2009, for each State.

• NT $275,700 against $66,877 or 4.12 times Male income
  
• NSW $283,300 against $69,253 or 4.09 times Male income
  
• QLD $270,800 against $66,518 or 4.07 times Male income
  
• VIC $249,000 against $66,970 or 3.72 times Male income
  
• WA $282,800 against $81,276 or 3.48 times Male income
  
• SA $214,800 against $63,096 or 3.40 times Male income
  
• ACT 261,900 against $78,124 or 3.35 times Male income
  
• TAS $191,700 against $59,872 or 3.20 times Male income
  

Links

Mortgage Information Comparisons

• Cannex - an independent Financial Services Research Group

• Infochoice - a web site to compare banks and their services

Mortgage Brokers

• Aussie home loans
• Rams home loans
• Wizard home loans - About 230 Wizard branches. On 27 February 2009 Wizard Home Loans was sold to Aussie home loans
• Mortgage Choice - At June 2003, Mortgage Choice has over 400 franchisees nationwide

Previous Mortgage rates

Looking at Mortgage rates since 1989, the average standard variable rate for the last 20 years has been 9.12% !!

December 2008

Standard Variable Mortgage rate changes following the RBA interest change cut on Dec 3, 2008

• 6.74% CBA
• 6.74% NAB
• 6.91% ANZ
• 6.91% Westpac
- Effective from around the 12th December

November 2008

Standard Variable Mortgage rate changes following the RBA interest change cut on Nov 4, 2008

• 7.71% Westpac.
• 7.74% NAB.
• 7.74% Commonwealth.
• 7.74% ANZ.
• 7.74% St George.

July 2008

Australian Standard Variable Mortgage rates at July 2008

• 9.47% Westpac Bank.
• 9.58% Commonwealth Bank of Australia
• 9.61% National Australia Bank.
• 9.62% ANZ Bank
• 9.67% St George Bank.

Historical Interest Rates

Mortgage Interest rates during the terms of the last 4 governments have been:

• 1972 - 1975 rates went UP from 7% to 10.38% (up 3.38%)
  
• 1975 - 1983 rates went UP from 10.38% to 12.5% (up 2.12%)
  
• 1983 - 1996 rates went DOWN from 12.5% to 10.5% (down 2.00%)
  
• 1996 - 2007 rates went DOWN from 10.5% to 8.55% (down 1.95%)
  
• 2008 - 2...
  

Standard Australian Variable Home Loan Interest Rates 1989 - 2010