Australia's major mortgage lenders have started to raise their fixed rates for home loans amid growing expectations that the Reserve Bank's rate-cutting cycle is nearing its end.
All the big four banks have increased some of their fixed rates over the past month. The moves come as the housing market heats up, with building homes for new homes rising by a stronger-than-expected 14.4 per cent in September Bureau of Statistics figures released today show.
Commonwealth Bank, the country's biggest mortgage lender, has lifted its three-year fixed loan rate by five basis points to 4.79 per cent and its four and five-year rates by 20 basis points to 5.59 per cent and 5.69 per cent respectively.
ANZ, the second largest home loan lender, increased its three-year fixed rate by 20 basis points to 5.34 per cent on Friday. Westpac raised its three-year fixed rate by 20 basis points to 5.39 per cent yesterday.
The National Australia Bank also lifted its three-year rate by 20 basis points, effective on October 21, to 5.19 per cent. The bank's five-year rate rose by 24 basis points to 5.79 per cent.
"With (RBA) interest rates at all-time lows, it's inevitable that rates will start to rise and while it is too early to call when this will happen, it's not inconceivable that this could happen next year," said Alex Parsons, the chief executive comparison website RateCity.
"We know fixed rates usually start to rise well before variable rates, and borrowers often miss the lowest point."
About 82 to 85 lenders measured by comparison website Canstar raised one or more of the rates on their fixed products this month, a jump from 11 lenders in August.
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