market update

The robust competition among lenders is starting to heat up, which is currently a significant advantage for borrowers. This competition is helping keep mortgage rates more affordable despite economic pressures.

The average variable mortgage rate for new owner-occupied loans is around 6.27%. For investor loans, the rates are slightly higher, averaging around 6.53%. These rates, although higher than in previous years, reflect the efforts by lenders to offer attractive deals and maintain market share. Lenders are also more open to better pricing and increased retention strategies.

Despite stability in housing prices and an increase in home sales, mortgage arrears are trending upward. According to data from the Australian Prudential Regulation Authority (APRA) for the March quarter, 1.6% of home loans are now in arrears, up from 1% in the previous quarter. This increase indicates that while new borrowers are benefiting from competitive rates, existing borrowers are facing challenges in meeting their mortgage obligations.