Leading lenders are trimming interest rates ahead of the Reserve Bank of Australia’s (RBA) upcoming meeting, reflecting intensifying competition in the mortgage market.
ANZ is the latest of the big four banks to lower its fixed rates, cutting them by 10 to 35 basis points across its product range.
Following these reductions, ANZ’s two-year fixed mortgage rate now starts at 5.19 per cent—down 20 basis points. Its three-year rate is set at 5.34 per cent, while the four- and five-year fixed rates are both trimmed by 10 basis points to 5.74 per cent.
This rate adjustment comes just ahead of the RBA’s next meeting on July 8, where the central bank is widely expected to lower the official cash rate by another 25 basis points to 3.60 per cent.
According to Canstar’s data insights director, Sally Tindall, ANZ currently offers the lowest fixed rates among the big four banks for terms ranging from one to five years.
She noted that ANZ may be trying to strengthen its loan portfolio by attracting more borrowers to fixed-rate mortgages. Currently, only 3 per cent of ANZ’s residential loans are on fixed terms, leaving 97 per cent on variable rates that can change at any time without significant exit fees.
While ANZ leads its major competitors on fixed rates—particularly for shorter terms—Tindall pointed out that several non-major lenders are offering even lower deals. Thirteen lenders now have at least one fixed rate below 5 per cent.
Pacific Mortgage Group holds the lowest one-year fixed rate at 4.99 per cent, Easy Street leads for two-year terms, and BOQ/People’s Choice and Heritage Bank offer the most competitive rates for longer fixed periods.
“If you’re planning to fix your rate, don’t settle for one starting with a five or six—you should be aiming for a rate in the fours,” Ms Tindall advised.
