The Reserve Bank board has kept interest rates on hold once again at 4.1%. That’s four in a row holds for the Reserve Bank.
Michele Bullock and the Reserve Bank board met today (3 October 2023) and have decided to hold interest rates steady once again. It’s Governor Bullock’s first decision and no doubt a welcome decision by homeowners country wide.
Governor Bullock’s statement included an indication that interest rates will be higher for longer. “Timely indicators on inflation suggest that goods price inflation has eased further, but the prices of many services are continuing to rise briskly, and fuel prices have risen noticeably of late,” she said.
Inflation took a turn for the worse recently with oil prices causing in a small increase for inflation rates up to 5.2%. “Inflation in Australia has passed its peak but is still too high and will remain so for some time yet,” she said.
Governor Bullock also reiterated that the Reserve Bank Board remains determined to reduce inflation back to the target range. “The board remains resolute in its determination to return inflation to target and will do what is necessary to achieve that outcome.”
Lower interest rate home loans
Mish Tan, head of finance statistics at the Australian Bureau of Statistics (ABS) said that there continues to be strong activity in refinancing home loans based on the recent run of increases in mortgage rates. “Refinancing has remained at unprecedented levels as households continued to seek better loans amid a high interest environment,” she said.
Homeowners have endured a significant number of mortgage rate increases over the last 18 months. Based on an average home loan value of $500,000 monthly home loan repayments have increased by just over $1,000 impacting household budgets.
There are still opportunities to reduce your mortgage repayments by looking at moving bank. There is competition amongst the banks and refinancing your house can have a number of benefits, not least reducing your interest rates and repayments.
A number of banks are also offering mortgage cashback offers on moving your home loan and are generally providing a more competitive mortgage rate to entice customers to their bank.
Mortgage repayments calculator
If you’re looking for a better deal on your home loan and you want to know what a different rate can make, check out our Mortgage Repayment Calculator. Enter in your current mortgage details and then play around with the mortgage rate and see what a difference saving a percent or even half a percent makes.
What other strategies are there to combat high interest rates?
A mortgage broker can assist on preparing a strategy to target the current higher interest rate environment. There are a number of strategies that can be deployed including;
- Refinance and save with a lower interest rate
- Add in a Home Loan Offset Account to reduce the interest you pay
- Move to a weekly or fortnightly repayment cycle to pay off more, faster
- Use your home loan for debt consolidation with personal loans and credit cards
A mortgage broker can advise on these strategies and help implement them.
What is the role of a Mortgage Broker?
A Mortgage Broker will help and advise you through the process of taking out a mortgage or moving from one lender to another lender. There is no cost to you to use a mortgage broker. As a borrower the service is free, and a mortgage broker is paid by the bank. They act on your behalf and are a personal financial guide through the process of purchasing a home or refinancing your mortgage.
Looking for a Mortgage Broker?
One Click Life is a mortgage broker that can help you select the right bank for your needs.
We have a team of qualified mortgage professionals to help you select the right mortgage and importantly the best interest rate based on your personal circumstances.
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