Long term interest rates
“After two rate cuts earlier in the year, the Reserve Bank’s decision to hold the cash rate at their historically low level of 1.5% came as no surprise,” Lawless said. So whilst variable rates have stayed steady – the fixed rate market has made some moves.
A lot of the financiers are now turning their attention to the longer-term lending – 5 year fixed rates. Some banks are now offering 3.75% fixed 5 years for owner occupied and 3.99% Fixed 5 years for investment.
Historically these are amazing rates. What is also means is that the economists who study this stuff full time believe rates to stay relatively low for some time.
So, although no one needs to panic and rush out to fix immediately – with such good rates on offer they are hard to ignore.
As always, you should always consider your own personal circumstances when considering to fix or not. A lot of fixed loans do not allow for an offset account to be linked to the mortgage. More importantly fixed loans can be expensive to break out of. So, if you are considering moving, selling or refinancing in the next 5 years you need to consider whether this fixed rate is for you.
On the other hand – if you are staying put, then locking your lending away for 5 years at less than 4% is historical and you should may headway during this time as quickly as you can.
As always we are here to run numbers and do a health checks on your existing mortgage. Contact me on mobile 041890354 or email donna-lee@celsiusfinance.com.au