Bank of Queensland has further cut fixed rates ahead of the August RBA decision to hit market leading lows, but ANZ has gone the other way with a variable rate hike despite its economists predicting a rate cut next week.
The new lowest rate at BOQ is 4.89% p.a. (5.62% p.a. comparison rate*) for two years fixed, LVR up to 80%, after a 10 basis point cut.
It’s the lowest among an array of fixed rates now below 5% p.a., but for many customers variable rates remain more appealing with most economists anticipating the RBA will cut by at least another 25 bps at next week’s monetary policy meeting.
ANZ economists are among those calling a cut, but in spite of this the variable rate on the ANZ Plus Home Loan has been increased by 16 bps to 5.75% p.a. (5.76% p.a. comparison rate*).
If the RBA does cut and ANZ passes it on to variable customers, it means the ANZ Plus rate will drop by just 0.09%.
ANZ has stressed this change will only apply to new customers not existing.
This is still the lowest advertised rate on offer at ANZ, however the ANZ Plus suite of products is accessed only via the Plus app and is generally considered separate to mainline ANZ products.
It also means that the Commonwealth Bank Digi Home Loan is now the outright lowest variable rate available at the big four.
BOQ new home loan rates
These are the new owner occupier rates at BOQ:
| Product | Rate Change |
|---|---|
| 2-year fixed (LVR ≤95%) | Down 10 bps to 5.24% p.a (5.69% p.a comparison rate*). |
| 2-year fixed (LVR <80%) | Down 10 bps to 4.89% p.a (5.62% p.a comparison rate*). |
| 2-year fixed (LVR 80-90%) | Down 10 bps to 5.24% p.a (5.69% p.a comparison rate*). |
At 4.89% p.a., BOQ takes the crown of lowest home loan rate in our database from Greater Bank, currently at 4.94% p.a. (6.88% p.a. comparison rate*) for three years fixed.
For investors, the new two year fixed rates are:
| Product | Rate Change |
|---|---|
| 2-year fixed (LVR 80-90%) | Down 9 bps to 5.50% p.a (5.83% p.a comparison rate*). |
| 2-year fixed (LVR <80%) | Down 9 bps to 5.15% p.a (5.79% p.a comparison rate*). |
| 2-year fixed (LVR 80-90%) | Down 10 bps to 5.34% p.a (5.83% p.a comparison rate*). |
At 5.15% p.a., BOQ also offers one of the lowest investor rates on market.
ANZ hike a sign RBA cut no sure thing?
For many home loan holders the ANZ hike will be seen as a cynical effort to clawback margins ahead of any further RBA rate cuts.
Its economists are still officially predicting a 0.25% cut (taking the cash rate to 3.60%) – ANZ Head of Australian Economics Adam Boyton saya “several factors” will allow Michele Bullock and the Board to bring rates down.
“The June rise in the unemployment rate, the 0.6% quarterly increase in the trimmed mean [inflation] in Q2 and what we expect will be RBA staff forecasts likely showing trimmed mean inflation around the mid-point of the target band…will enable the Board to cut in August,” he said.
It’s important to remember the cash rate isn’t the only reason variable rates are adjusted – a change in strategy or shifting market conditions sometimes prompt an out of cycle move.
An ANZ spokesperson said the bank considers “a range of factors” when setting home loan rates.