Interest rates – What’s happening?

What is going on with interest rates (especially fixed interest rates) at the moment is really interesting.

The variable interest rate (or cash rate) is only impacted by the RBA. They decide to either put the rates up or down and at the moment, the variable interest rate is on its way down. This is good news for investors as it puts more cash in our back pockets, effectively giving us a ‘pay rise’ each time interest rates fall.

Fixed interest rates on the other hand are impacted in a different way. The RBA has no control over fixed rates. What controls long term fixed rates is the Bond Market. Simply put, bonds are purchased by investors looking for low risk long term investments. At the moment, bond yields are at their lowest since federation, down from 3.6% to 2.9%.

What this means for us as investors is that long term fixed rates are coming down. The three year fixed interest rates are attracting interest by investors as they are generally half a percent lower than the standard variable rates of most lenders. Fixed rates are expected to reduce further so watch this space before choosing to fix.

As a guide, when fixed interest rates fall below 6%, consider locking in mortgages on properties you intend to hold for the long term.


 

 

Fixed rates                            Interest Rate

1 Year Fixed Rate                 5.89% p.a.
2 Year Fixed Rate                 5.99% p.a.
3 Year Fixed Rate                 6.09% p.a.
4 Year Fixed Rate                 6.69% p.a.
5 Year Fixed Rate                 6.84% p.a.

 

 

 

Fixed rates                             Interest Rate

1 Year Fixed Rate                  6.19% p.a.
2 Year Fixed Rate                  6.09% p.a.
3 Year Fixed Rate                  6.19% p.a.
4 Year Fixed Rate                  6.69% p.a.
5 Year Fixed Rate                  6.69% p.a.
10 Year Fixed Rate                7.99% p.a.

 

 

Fixed rates                            Interest Rate

1 Year Fixed Rate                  6.14% p.a.
2 Year Fixed Rate                  6.14% p.a.
3 Year Fixed Rate                  6.14% p.a.
4 Year Fixed Rate                  6.74% p.a.
5 Year Fixed Rate                  6.79% p.a.
10 Year Fixed Rate                7.79% p.a.

 

 

Fixed rates                             Interest Rate

1 Year Fixed Rate                  5.99% p.a.
2 Year Fixed Rate                  5.79% p.a.
3 Year Fixed Rate                  5.99% p.a.
4 Year Fixed Rate                  6.29% p.a.
5 Year Fixed Rate                  6.39% p.a.
10 Year Fixed Rate                7.59% p.a.

 

Stay connected, be curious and as always, happy investing,

Helen Collier-Kogtevs

Share this post

Share on facebook
Share on google
Share on twitter
Share on linkedin
Share on pinterest
Share on print
Share on email

Become a successful Property Investor

Start Here With Your Free Investment Gift Pack Valued at $297
how to project manage your renovation

Get one step closer, Fill in the form below

  • This field is for validation purposes and should be left unchanged.

More from Real Wealth Australia

Property market about to go ballistic in australia
Articles

The Property Market Is About To Go Ballistic!

I’ve got good news for you and more good news! Firstly, you may have heard that the Reserve Bank of Australia (RBA) have indicated that …

How to Maximise Your Most Important Investments this Christmas_7
BLOG

How to Maximise Your Most Important Investments this Christmas

Your biggest investment: what it is and how much is it worth? If it’s your home, it could be worth a fair chunk of change. …

/the-next-boom-cycle-is-coming-prepare-yourself/
Articles

It’s official! Australia is now in a recession… now what?

As Australia has experienced three months of negative growth we are now officially in recession. I wanted to share my thoughts on this as there …