June home loan snapshot: Bendigo, Citi and Macquarie lower variable rates

Winter’s finally here and so too are the colder days and longer nights. For many of us that means taking life at a slower pace and indulging in the pleasures of food and warmth that come indoors.

There’s no slowdown on the home loan rate front though! The latest edition of the Mozo Banking Roundup, which was released this morning, shows that lenders are continuing to chop and change both fixed and variable home loan rates at a steady pace.

So what’s changed and how does your own rate stack up? Find out in our latest snapshot.

Variable rate competition intensifies

Earlier last month we reported on the renewed rise in variable rate cuts following a long period in which attention from lenders was largely focused on fixed rate cuts. This trend has continued to play out in recent weeks, with a number of additional lenders announcing reductions to variable home loan rates. Some of the highlights include:

• Athena cut its AcceleRATES Variable Home Loan by 10-20bp for owner occupiers, meaning rates are as low as 1.99% (1.99% comparison rate*) for <60% LVR or 2.19% (2.08% comparison rate*) for <80% LVR

• Bendigo Bank reduced its Express Home Loan by 50bp, meaning the lowest rate on offer to owner occupiers (<90% LVR) is 2.19% (2.36 comparison rate*)

• Citi took 15bp off its Basic Variable loan which means its lowest rate for owner occupiers (<80% LVR) is 2.29% (2.34% comparison rate*)

• Homestar cut its Star Essentials Home Loan by 10bp, meaning owner occupiers (<80% LVR) can access rates as low as 2.04% (2.09% comparison rate*)

• Macquarie reduced its Basic Home Loan by 15bp to 2.49% (2.49% comparison rate*) for owner occupiers (<80% LVR)

• Tic:Toc cut its owner occupier (<90% LVR) Variable Home Loan rate by 15bp to 2.04% (2.05% comparison rate*) and its investor (<90% LVR) rate by 14bp to 2.19% (2.20% comparison rate*)

As a result of the various cuts the average variable home loan rates^^ in the Mozo database for owner occupiers (3.26%) and investor (3.66%) making principal and interest repayments both dropped to the lowest points recorded since we began tracking in 2015.

Competition at the lowest end of the market has also become even fiercer. There are now 41 lenders in our database with a headline variable rate below 2.50% for owner occupiers (<80% LVR), though as the table below shows, there are even lower rates available.

Lowest variable rates - Mozo database (June 1, 2021)^^

Fixed rate divide continues

For the past few months we’ve been witnessing a growing divide between shorter (1-3 years) and longer (4-5 years) fixed rate home loans, with the former remaining relatively stable and the latter increasing.

According to the Mozo Roundup that trend continued to play out in May, with the likes of Citi, Commonwealth Bank, Greater Bank, ING, Macquarie, NAB, Qudos Bank, Tic:Toc and Well Home Loans among the lenders to have lifted 4 or 5-year fixed rates in the past month.

ING was also one of the more notable lenders to reduce its shorter rates. The bank shaved 15-35bp off of its 1-3 year Fixed Rate Loan (with Orange Advantage) offer, with the lowest rate now 1.84% (3.73% comparison rate*) for owner occupiers (<80% LVR) for two years.

So what’s the landscape looking like at the sharpest end of the fixed rate market? Here’s a snapshot of the lowest fixed rates currently on offer to owner occupiers in the Mozo database, as well as our owner occupier averages for 1-5 year terms:

Lowest and average fixed rates - Mozo database (June 1, 2021)^^

The Reserve Bank board is also announcing its monthly Monetary Policy Decision this afternoon which always has the potential to create some upheaval in the home loan rate market, though it's generally thought that it will continue to stay its hand for the time being.

To stay up to date with that decision plus the latest property stories check out the Mozo home loan news hub, or if you’re interested in comparing loans then you’ll want to take a look at our home loan comparison tables for the latest rates.

^^Interest rates are based on an owner occupier making principal and interest repayments on a $400,000 loan with an 80% LVR. For more information on average mortgage rates, check out our dedicated Australian home loan statistics page.