change your clocks, change your smoke alarm batteries


New swimming pool requirements come into effect in October


is now the time to fix your home loan?

empty image
empty image

Overloaded blue piggy bank, surrounded by gold and silver coins.The Reserve Bank has continued with the recent trend and decided to leave official interest rates on hold at 3 per cent at its meeting this week. This is the third consecutive month rates have remained on hold.

Many home owners are asking the question, is now a good time to lock in my interest rate? There is no easy way to answer that question, as it depends on a number of individual factors and the type of loan you have.

Fixed rate loans have dropped to their most competitive levels in months, prompting many mortgage holders to lock in their loans. Before you go ahead and lock in your rate there are many important factors you need to first consider. Some fixed loans don’t allow you to make large extra payments on your loan. You may not be allowed to link an offset account to your loan and redraw any additional payments that you have already made. Many banks allow you to split your loan into two loan accounts and then fix one of those accounts, this allows you to keep part of your loan variable so you can retain some flexibility.

Although the Banks remain on watch for any signs of deterioration in economic activity, recent data has been reasonably positive. As a consequence, the general economic outlook remains relatively optimistic both locally and internationally.

Housing markets have been a beneficiary of low interest rates this year with forward indicators such as auction clearance rates clearly ahead of last year results. “This years increased home buyer activity is set to be maintained into winter driven by historically low interest rates and rising confidence”, says Dr Andrew Wilson Senior Economist for Australian Property Monitors. “With strengthening housing markets and a generally solid economy, rates are expected to remain on hold at least over the near-term”.

If you are considering fixing your home loan, speak to your bank who will explain all the options with you and help you make an informed decision.