Canstar data shows fixed-rate increases spreading across most lenders as sub-6% deals thin out
Westpac has increased its fixed home loan rates for the second time in three weeks, adding 0.15 percentage points to selected products as markets weigh the chance of further Reserve Bank tightening, with the next decision due in 12 days.
The move follows Westpac’s earlier increases of up to 0.45 percentage points. After the latest change, the bank’s lowest advertised fixed rate is 6.29% on a two-year term. Despite the rise, Westpac remains the cheapest of the major banks on fixed rates.
| Big four banks’ lowest fixed rates | ||||
|---|---|---|---|---|
| Term | CBA | Westpac | NAB | ANZ |
| 1-year | 6.49% | 6.39% | 6.34% | 6.34% |
| 2-year | 6.34% | 6.29% | 6.39% | 6.39% |
| 3-year | 6.59% | 6.49% | 6.49% | 6.54% |
| 4-year | 6.64% | 6.69% | 6.49% | 6.54% |
| 5-year | 6.79% | 6.69% | 6.49% | 6.59% |
| Source: Canstar.com.au. Rates based on owner-occupier fixed rate loans. LVR requirements apply. | ||||
Canstar’s rate tracking indicates the repricing is widespread. Its figures show more than 90% of lenders have lifted at least one fixed rate since the RBA’s March cash rate decision, including all four major banks. Two of the majors have raised fixed rates twice over that period. Since 17 March, the banks have adjusted fixed rates on the following dates: Commonwealth Bank on 27 March; Westpac on 2 April and 23 April; NAB on 27 March and 10 April; and ANZ on 1 April.
Canstar’s research suggests lenders may be building in expectations of more than a single RBA increase. The average of the lowest fixed rates on its database has risen by 0.42 to 0.43 percentage points over the past five weeks.
The number of lenders offering at least one fixed rate below 6% has fallen to 19, compared with 83 at the start of the year, according to Canstar. The lowest fixed rate listed is 5.49% from Northern Inland Credit Union for a one-year term.
| Lowest fixed rates | ||
|---|---|---|
| Term | Lender | Lowest rate from |
| 1-year | Northern Inland Credit Union | 5.49% |
| 2-year | Bank Vic | 5.79% |
| 3-year | BankVic | 5.79% |
| 4-year | BankVic | 6.09% |
| 5-year | Horizon Bank | 5.94% |
| Source: Source: Canstar.com.au. Rates based on owner-occupier fixed rate loans. LVR requirements apply. | ||
“Fixed rates are on the move again, with some lenders going for a second round of hikes in-between RBA meetings,” said Sally Tindall (pictured right), data insights director at Canstar.com.au.
“Westpac’s doubling down on fixed rate hikes isn't an isolated event. Plenty of banks are heading back to the pricing drawing board, some for the second time in a matter of weeks, as a result of growing concern Australia’s inflation rate is about to spike once again.
“Canstar analysis shows more than 90% of lenders have moved fixed rates since the last RBA decision, including all four big banks, with both Westpac and NAB having two stabs at it in this time.”
According to Canstar, lenders are not just hiking by a standard cash rate increase, with average owner-occupier fixed rate having risen by 0.43 percentage points since the last RBA decision in March.
“Banks don’t exactly want to get caught short having to fund what might turn out to be a competitively-priced fixed rate loan, particularly when a rate that starts with a ‘6’ isn’t going to help them attract new customers,” Tindall said.
“For borrowers, this swift repricing is a clear signal – opportunities to lock in a more competitive fixed rate are slipping away.
“There’s just 19 lenders offering fixed rates below 6% today. At the start of the year, it was about the same number of lenders offering rates below 5%. That’s a sharp about-face in the fixed-rate market in a remarkably short space of time.”
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