Have Fixed Rates Hit The Bottom Of The Cycle?
I have noticed an interesting pattern in one of the recent interest rate charts.
This is slightly dangerous territory because the past is obviously not a prediction of future rate directions. However, this pattern does seem to apply at least since the beginning of 2009 (when this data series commenced).
The 3 year fixed rate seems to be around three to six months ahead of the variable rate.
In other words, if the 3 year fixed rate line in this chart was to be moved forward by around four or five months you would see both lines almost overlapping.
In consideration of this pattern, you will note that the 3 year fixed rate has been flat lining for five months.
However, two of the second tier lenders on our panel have recently increased their 3 year fixed rates. Hopefully this is not the start of that upward cycle.
The current average 3 year fixed rate for the big four banks (see above) is 4.97% p.a. Consider this against one of our non major lender that is currently offering 4.69% p.a.
About Aaron Sainsbury
With expertise spanning mortgage lending, property law, property investment and borrowing to invest within Self Managed Superannuation, Aaron Sainsbury offers more than 25 years professional advisory expertise.
He is an enthusiastic supporter of financial literacy, working closely with clients to help them gain and maintain control of their financial future.
Aaron is thoroughly committed to building lifelong relationships with clients based on the highest quality service, advice and trust.
Contact Aaron direct on 02 9818 8643 .
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