Commercial loans including mortgages to investors fell 7.8 per cent in September and home loans to owner-occupiers fell 2.1 per cent to $20.7 billion as Australia’s property market slows.
Personal loans rose 0.8 per cent to $6.24 billion in September, while lease finance fell 1.3 per cent to $565 million.
“This sudden surge of rate competition at the tail end of the spring property season has coincided with improved conditions for first homebuyers including cooling capital city housing prices, less competition from investors and stamp duty exemptions and discounts in New South Wales and Victoria,” Mozo director Kirsty Lamont said.
With the scales now tilted more in their favour, lenders are expecting first homebuyers who gave up hope of ever owning a property to start looking again and want to entice as many new mortgage customers as they can by offering rock bottom interest rates.”
“Right now lenders want to be seen to have a headline variable rate starting with a 3. With the Reserve Bank likely to tread carefully around official interest rates until mid-2018, banks appear to be taking the lead on monetary policy as they see fit.”
Mozo says a handful of lenders have also introduced new offers in the last month with rates for owner-occupiers paying off principal and interest starting at 3.39 per cent.