March home loan snapshot: Fixed mortgage rates continue to soar

How quickly things change.

Rewind to March 2021 and you’d have found that fixed home loan interest rates were on the downslope. In fact, they were at some of their lowest points in years and plenty of lenders, including the major banks, were offering loans with rates starting with a ‘1’.

The picture couldn’t be more different today though, because if there’s been one dominant theme in the home loan market in recent weeks, it’s been fixed home loan rate hikes.

So which lenders have raised their fixed rates? What do the lowest and average home loan rates in the Mozo database look like? And how are variable home loan rates faring? Find out below.

Recent fixed and variable rate movements

Since the start of February 70% of lenders being tracked in the Mozo database have increased fixed rates on at least one of their home loans, so it’s safe to say that it’s difficult to highlight just a handful of these rate hikes. But here are some of the more notable changes:

• A prime example of the pace of change, ANZ actually raised fixed rates twice over the last month. The lowest fixed rate now on offer with the bank is 2.69% p.a. (2.97% p.a. comparison rate*) on a 1-year term for owner occupiers (<80% LVR)

• Fellow major bank CBA also lifted its fixed rates twice during February , meaning its lowest fixed rate is now 2.79% p.a. (4.17% p.a. comparison rate*) on a 1-year term for owner occupiers (<95% LVR)

• ING also made the decision to hike fixed rates twice in recent weeks. The lowest fixed rate available with the online bank is now 2.49% p.a. (2.39% p.a. comparison rate*) on a 1-year term for owner occupiers (80% LVR).

While the majority of the recent rate changes have been made to fixed loans, there have been a few noteworthy cuts to variable rate home loans as well:

• Online lender loans.com.au cut 20bp off its Green Home Loan, meaning the lowest variable rate on offer to owner occupiers (<80% LVR) with an environmentally-friendly home is 1.88% p.a. (2.30% p.a. comparison rate*)

• Citi reduced the variable rate on its Basic Variable loan by a further 10bp, meaning owner occupiers (<80% LVR) can access rates as low as 1.99% p.a. (2.04% p.a. comparison rate*)

• Bank Australia reduced the variable rate on its Basic Home Loan offer for owner occupiers (<80% LVR) by a substantial 31bp to 1.99% p.a. (2.03% p.a. comparison rate*)

Average home loan rates

So how have these recent changes impacted the average home loan rates being tracked in the Mozo database? While the average variable rate has remained relatively steady month-to-month at 3.05%, the average fixed rates in our database have continued on their upward trajectory across all terms.

You can find more graphs focusing on average home loan rates and lending volumes by visiting our dedicated Australian home loan statistics page.

Lowest home loan rates

What about some of the lowest mortgage rates around? Well, the very sharpest variable rates have also remained relatively stable over the past month, but further rate hikes have altered the landscape among the fixed rate leaders in the Mozo database. Here’s a look:

Lowest variable rates — Mozo database (March 1, 2022)^^

Lowest and average fixed rates — Mozo database (March 1, 2022)^^

While these are the lowest rates available in our database for borrowers with an <80% LVR, it’s worth pointing out that there are even lower rates on offer to borrowers with even lower LVRs - namely below the 70% and 60% LVR tiers.

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Interested in seeing how your own mortgage rate stacks up against other offers on the market? Check out some of the hot fixed and variable deals in the table below, or head over to the Mozo home loan comparison hub to compare loans from a range of Australian lenders.

^^Interest rates are based on an owner occupier making principal and interest repayments on a $400,000 loan with an 80% LVR.