The residential transformation of St Kilda Road is set to continue into with more new apartment plans for the sought-after boulevard.

Wing Tai Asia has lodged plans for a major residential tower at 464-466 St Kilda Road, replacing the former VACC House with an 18-storey mixed-use development designed around a retained heritage podium and a sculpted contemporary tower.

The proposal, prepared under Victoria’s Significant Residential Development with Affordable Housing pathway, would deliver 325 apartments and ground-floor retail across the prominent 4,653 sqm boulevard site in Melbourne’s St Kilda Road North Precinct.

The project centres on the adaptive reuse of the site’s heritage-listed VACC Building, an eight-storey office designed by Bernard Evans that has occupied the address for decades. Planning documents state the development would involve “carefully dismantling and conserving off-site the original metal fabric of the podium visible from St Kilda Road,” before reinstating it as the defining frontage of the new scheme.

Above the restored podium, Wing Tai is proposing a curvilinear residential tower. The scheme includes 172 one-bedroom apartments, 63 two-bedroom apartments, 66 three-bedroom apartments, and 24 four-bedroom apartments, alongside two ground-floor food and beverage tenancies fronting St Kilda Road.

The tower has been designed with substantial articulation and variable setbacks to minimise perceived bulk and maintain view corridors along the boulevard. Urbis, which prepared the planning report, said the design “has been significantly articulated through a curvilinear design” with “an interplay with materials, façade expression and depth” to create visual separation and visual interest.

The proposal also includes 254 basement car spaces, landscaped pedestrian links connecting St Kilda Road and Queens Lane, and a biophilic landscape strategy featuring canopy trees, raised planters, cascading greenery and a glass oculus pool overlooking the eastern frontage.

Planning documents confirm the $270.1 million development will contribute 3 per cent of project costs to the Social Housing Growth Fund as part of the application process.

Wing Tai acquired the St Kilda Road property in 2018 alongside Abacus Property Group for $95.38 million, before later consolidating ownership of the site. The property previously served as the Victorian Automobile Chamber of Commerce headquarters for around 60 years.

The transformation of the St Kilda Rd boulevard is already beginning to materialise, with a number of high-profile projects recently completed, launched, or approaching launch as developers continue to back the long-term appeal of the precinct.

Among the most notable recent completions is Louise by Samuel Property Group, just off the strip on Queens Lane, the same pocket Hirsch &amp; Faigen recently launched The Queensbury. Mirvac is too on the same street with The Albertine, which is approaching completion.

Dexus recently secured approval for its slice of St Kilda Road, while Gurner also has approved plans for the precinct.

Joel Robinson

Wing Tai unveils 325-apartment St Kilda Road tower on former VACC House site

Malaysian developer <a href="https://www.apartments.com.au/developers/s-p-setia">SP Setia</a> is the latest to jump into St Leonards booming Transport Oriented Development precinct.

The developer, which has previously delivered Sapphire by the Gardens apartment development in Melbourne, identified the Atchison Street site in 2023. It filed a Scoping Report around 12 months ago, and now has revealed the designs for the new&nbsp;40-storey mixed-use tower.

The State Significant Development Application covers <a href="https://next-portal.urban.com.au/projects/14650/summary">20-22 Atchison Street</a>, a 1,374 sqm site positioned between St Leonards Station and the new Crows Nest Metro station.

Designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, the project would deliver 181 apartments, above a four-storey commercial podium, five basement levels, and new public domain works along Mitchell Street. The apartment mix comprises 35 one-bedroom apartments, 39 one-bedroom-plus-study apartments, 85 two-bedroom apartments, and 22 three-bedroom residences.

The proposal has been lodged as a shop-top housing development under the NSW Government’s TOD planning pathway, which allows increased density around key transport infrastructure. The site sits within the recently rezoned Crows Nest Accelerated TOD Precinct.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b799673d-48e2-46b0-801a-0e33a9330100" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20site.png?VersionId=dPh0UfwfaHpbFL1R7H1cbZNbIW0CHbCC" />

SP Setia acquired the Atchison Street site as part of its continued expansion into the Australian apartment market. In comments made to City &amp; Country (The Edge Malaysia) in 2023, SP Setia President and CEO Datuk Choong Kai Wai described the acquisition as “a strategic move” aligned with the group’s post-pandemic market recovery strategy.

“Our target for this exceptional development is local and overseas buyers, including first-home buyers, downsizers and investors,” Choong said.

The tower has been designed as a slender vertical form rising from a mixed-use podium, with COX Architecture positioning the development as a response to the evolving St Leonards and Crows Nest skyline.

“The purpose of the project is to facilitate the delivery of high-quality housing at a strategically located site and deliver a built tower outcome that is consistent with the desired future character of St Leonards and aligns with the TOD controls,” the design report stated.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b1a85eee-76f7-436c-a6da-73ba827b9b13" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20entry.png?VersionId=dA9jHGPMcm.dDbwk4QfxqWiY5bfh3UVt" />

The podium would incorporate retail uses fronting Atchison Street, commercial tenancies, landscaped communal areas, and pedestrian improvements along Mitchell Street. Vehicle access and loading would be consolidated via Atchison Lane.

Residents would have access to more than 665 sqm of communal indoor and outdoor spaces, while the development proposes 96 parking spaces across five basement levels.

The proposal also includes a commitment for 10 per cent of residential floor space to be allocated toward affordable housing through a monetary contribution.

COX said the tower form responds directly to the emerging high-density character of the precinct while seeking to maximise solar access, cross ventilation, and outlook from apartments.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="2163f85c-f63b-4be3-aafa-f8763976cec5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Article%20Feature%20Image%20%28Grid%29_5.png?VersionId=WiAmtIKJ6.ZQ41EtYEQ1fol7AeorKBlL" />

“The building is orientated towards north,” the Apartment Design Guide compliance report noted, adding that the tower’s slim form was driven by the constrained inner-urban site dimensions.

The design also incorporates landscaped setbacks and communal open space at podium level, intended to soften the interface with surrounding streets and improve pedestrian amenity.

The project adds to a growing wave of redevelopment proposals reshaping St Leonards and Crows Nest following the opening of the Sydney Metro City line and the NSW Government’s push for higher-density housing around major transport nodes.

Last week Stockland filed plans just down the road. They want to build a <a href="https://www.apartments.com.au/new-apartments/601-pacific-highway-st-leonards-nsw-2065">52-storey tower on Pacific Highway</a>.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-stockland-plans-52-storey-538-apartment-st-leonards-tower">First look: Stockland plans 52-storey, 538-apartment St Leonards tower&nbsp;</a>

First look: SP Setia targets St Leonards skyline with 40-storey TOD tower

<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a> has revealed plans for a new mixed-use tower at 10 Dangar Street, Wickham, advancing a proposal that would reshape the southern gateway to Newcastle’s city centre with one of the city’s tallest residential buildings.

The State Significant Development proposal, now on exhibition, seeks approval for a <a href="https://www.apartments.com.au/new-apartments/bowline-10-dangar-street-wickham-nsw-2293">43-storey tower</a> immediately adjacent to the Newcastle Interchange. The project would deliver around 200 apartments, including 42 affordable housing dwellings, alongside 99 co-living units, a 171-room hotel, retail space, and new public domain integrated through the site.

The scheme marks a significant escalation of plans previously approved for the site. Urban Property Group took over the prominent 2,904 sqm parcel, where excavation and demolition had already commenced under an earlier consent for a 14-storey mixed-use development.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="58a96dd9-407f-4d20-86b4-94e4bfeef74b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20podium.png?VersionId=LGlf08pdFGAZDzvx_CXC4XakHNZRuEE0" />

Designed by <a href="https://www.apartments.com.au/architects/sjb-architects">SJB</a>, the tower has been conceived as a landmark transit-oriented development anchored to the Newcastle Interchange precinct. The proposal includes 245 build-to-sell apartments across a mix of one, two, and three-bedroom residences, as well as two penthouses. Fifteen apartments and one operational unit are earmarked for NDIS housing. The co-living component would add a further 99 units, while the podium would accommodate retail uses and hotel facilities.

SJB said the site presents “a valuable opportunity to anchor the precinct by setting the standard for design, active ground planes and character at the key southern gateway.”

The architecture responds directly to the site’s position beside major transport infrastructure and within one of Newcastle’s fastest-evolving urban renewal precincts. The tower form sits above a sculpted podium designed to frame new public spaces, including a through-site pedestrian link connecting Station Street to Hannell Street, landscaped plazas, and activated retail edges.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="a7bd6ff0-f7db-4ce8-a6dc-ea56e72c6149" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20lanne.png?VersionId=xzf39VADyhj7zBQY2I9fx9vI62u2tuSb" />

The design report describes the project as part of the broader transition of Wickham into “a vibrant, high-quality mixed-use urban precinct” that leverages proximity to the station, open space, and regional connectivity.

A detailed public art strategy has also been prepared for the development. The strategy positions the project as “a transit-oriented development of state significance at the gateway to Newcastle’s city centre” and outlines a series of integrated artworks responding to Newcastle’s industrial and transport heritage.

Creative Road’s curatorial framework for the project, titled Unveil, draws on “stratified surfaces, carved volumes, and light-filled apertures” while referencing Newcastle’s transformation from an industrial city into a contemporary education and technology hub.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="77a882bb-14b1-4d28-99ff-9438e39508c0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20site.png?VersionId=cevgo_vN0eKPK78P8YcEu3mKPLkpFqE7" />

The proposal is being advanced through the NSW Housing Delivery Authority pathway after being declared State Significant Development in June 2025. The accompanying scoping report states the development aims to “maximise the site’s proximity to the Newcastle Interchange by delivering transit-oriented development” while increasing housing supply and affordable housing provision within the Newcastle LGA.

Urban Property Group’s plans align with the long-term strategic vision established under the Wickham Master Plan, which identified the interchange precinct as suitable for substantial uplift in height and density. The current proposal would significantly intensify that vision, positioning the tower among the tallest developments proposed for Newcastle.

The site sits immediately north of the Newcastle Interchange, bounded by Dangar Street, Hannell Street, and Charles Street. It is surrounded by a rapidly growing cluster of residential towers and mixed-use projects that have emerged following the completion of the light rail and transport interchange.

First look: Urban Property Group unveils Newcastle’s latest tower at Wickham interchange

Bottega House has completed settlement of a landmark riverfront site in Macquarie Street, St Lucia, representing its first major Brisbane development.&nbsp;

Positioned on the banks of the Brisbane River, the <a href="https://www.apartments.com.au/new-apartments/180-macquarie-street-st-lucia-qld-4067">premium site at 180 Macquarie Street</a> features uninterrupted river frontage in one of Brisbane’s most tightly held residential precincts.&nbsp;

The proposed development, currently under assessment with Brisbane City Council, has been designed by <a href="https://www.apartments.com.au/architects/plus-studio">Plus Studio</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/mim-design">Mim Design</a> and will deliver a boutique collection of premium residences positioned specifically for owner occupiers and downsizers.&nbsp;

The residences are set to redefine luxury apartment living in the area, with a focus on architectural quality, refined finishes, landscape integration and elevated amenities including curated wellness facilities, resort-style pools and recreation spaces rarely seen in the local market.&nbsp;

Exclusive sales for the project will be led by Keenan &amp; Byrne, ahead of an anticipated launch later this year.&nbsp;

Bottega House Managing Director Nick Malloch said the project reflects the group’s ambition to deliver a highly curated residential offering within one of Brisbane’s most tightly held precincts.&nbsp;

“This is an incredibly rare riverfront opportunity and one we have approached with a long-term perspective,” Malloch said.&nbsp;

“Our vision from the outset was to create a boutique collection of residences that feel more like private homes than traditional apartments, with generous proportions, refined finishes and exceptional amenity throughout."

Malloch says there is a&nbsp;lack of premium owner-occupier stock of this quality in the market, particularly for downsizers wanting space, privacy and a true lifestyle offering without compromise.&nbsp;

"Demand is expected to be strong given the scarcity of premium riverfront opportunities of this nature within Brisbane’s inner-west."&nbsp;

Bottega House secures landmark riverfront site in St Lucia 

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The arrival of the first piling rig officially marks the commencement of construction at SIERA’s new beachside apartment development, Exhale, in Northcliffe.

<a href="https://www.apartments.com.au/new-apartments/exhale-surfers-paradise-8-enderley-avenue-surfers-paradise-qld-4217">Exhale</a>, a glass-encased tower featuring 54 large-scale apartments at 8 Enderley Avenue, is SIERA’s third Gold Coast development. It follows the recently completed PIPIS Bilinga beachfront project, which achieved suburb-record prices, and the soon-to-be-completed Chevron Island development, Tapestry.

[smartcode_project:default project_id=112661 project_image_fid=359603]

<a href="https://www.apartments.com.au/developers/siera">SIERA</a> Founder and Managing Director Brent Thompson said the arrival of the piling rig represented a significant milestone for the development, which is scheduled for completion in late 2028.

Over the next month, around 260 piles are expected to be installed as work progresses on the basement structure. The building is anticipated to rise above ground level early next year, before unveiling its sculptural glass curtain wall, developed in collaboration with specialist façade engineers.

“The façade was designed to maximise panoramic coastal views while creating a distinctive architectural identity,” Thompson said.

[smartcode_project:default project_id=112661 project_image_fid=355935]

Designed by BDA Architecture, Exhale will comprise just 54 two- and three-bedroom residences across 26 levels, a level of low-density living rarely delivered in this beachside pocket between Surfers Paradise and Broadbeach.

The project has been conceived as a resident-only building, with no short-stay accommodation permitted. SIERA says the model is intended to appeal to long-term owner-occupiers rather than transient holiday demand.

[smartcode_project:default project_id=112661 project_image_fid=361052]

Residences have been designed with large-format layouts and expansive glazing, with most apartments featuring more than 30 metres of glass frontage to maximise natural light and ocean views.

The amenity offering spans two levels and centres on wellness and lifestyle, including a heated magnesium pool, sauna, yoga and Pilates studio, gymnasium, private dining facilities, cinema lounge, and dedicated surfcraft storage.

[smartcode_project:default project_id=112661 project_image_fid=359607]

More than half of the apartments have already sold. SIERA has also opened a sales gallery for Exhale at its Chevron Island commercial premises, near its Tapestry tower and the site of its second Chevron Island apartment development, which is slated to launch in early 2027.
</section>
</section>

[smartcode_project_cta:default project_id=112661]

SIERA kicks off construction at Northcliffe tower Exhale

National Australia Bank (NAB) has brought forward the timing of the first RBA cash rate cut by three months.

NAB is now expecting a cut in February, in line with ANZ and Westpac, having initially thought a cut wouldn't come until May.

Commonwealth Bank, the nation's largest lender, still thinks the first cut will come in December.

NAB changed its call following the August monthly inflation figures that were released at the end of September, showing it had dropped to 2.7 per cent.

"The risk has been skewed to a first cut earlier in 2025, and today’s change acknowledges the balance of risks has likely shifted sufficiently for the RBA to feel comfortable cutting a little sooner than we earlier expected," NAB noted in its latest update.

They added that the cadence of the cuts may be faster than its central profile.

"Domestic inflation pressures are cooling, but only gradually, and we continue to expect the conditions for a cut will not be in place this year.

NAB believes the easing cycle will end at 3.1 per cent by early 2026, which is five cuts from the current 4.35 per cent cash rate.&nbsp;

CBA also thinks 3.1 per cent will mark the end of the cutting cycle, while Westpac is forecasting 3.35 per cent, and ANZ is the most pessimistic at 3.6 per cent, which would be just three interest rate cuts.

<h2>What would a rate cut in February look like for borrowers?</h2>

According to&nbsp;<a data-saferedirecturl="https://www.google.com/url?q=https://link.mediaoutreach.meltwater.com/ls/click?upn%3Du001.IVvjJ-2BPT0A8C3VxtqKc6e3bj5hBuw27WFEYqovsYs7kPsgFulYrdOzeP8gI7CybJOya3_RgrM7qq-2BfK-2FtAHeRBLv5Qrb-2Bii5fzjLeKcP4w-2FkNgJPXygpiRhVUan3WV3QEggcf617UC8Z60RjQJZAqx7PiO7FtVJQSn0D46Zc3iTVP0kAhTTzG51cPpa5hrqz1OkSA-2BiXAxUajQ686MTtiseWBIdMdknd83aB7cOVgXlVTeHCGf3-2BcMHwfvI8TYlkUovqEhn4dj0KXf2eJGpb9-2BBv20hPXdLlPP9yD7DvFFDBM5yrTqxvcCiMfAsW1onD-2FcriL628eYdhNQE7bwzYrxcOYnmaYfRhGl-2FEHQ6eK2uQcLxs6Cbu6Dx0bYvpi5A6enmxMWU5TkcRYrP6Z8GbXZYtc5qSoKu6eWFBQR9K7fsjXwHMmby3D3X6Yx-2BxcDcdRruTG&amp;source=gmail&amp;ust=1727774368149000&amp;usg=AOvVaw2vK2ujS77CHs9VRvSSXzLC" href="https://link.mediaoutreach.meltwater.com/ls/click?upn=u001.IVvjJ-2BPT0A8C3VxtqKc6e3bj5hBuw27WFEYqovsYs7kPsgFulYrdOzeP8gI7CybJOya3_RgrM7qq-2BfK-2FtAHeRBLv5Qrb-2Bii5fzjLeKcP4w-2FkNgJPXygpiRhVUan3WV3QEggcf617UC8Z60RjQJZAqx7PiO7FtVJQSn0D46Zc3iTVP0kAhTTzG51cPpa5hrqz1OkSA-2BiXAxUajQ686MTtiseWBIdMdknd83aB7cOVgXlVTeHCGf3-2BcMHwfvI8TYlkUovqEhn4dj0KXf2eJGpb9-2BBv20hPXdLlPP9yD7DvFFDBM5yrTqxvcCiMfAsW1onD-2FcriL628eYdhNQE7bwzYrxcOYnmaYfRhGl-2FEHQ6eK2uQcLxs6Cbu6Dx0bYvpi5A6enmxMWU5TkcRYrP6Z8GbXZYtc5qSoKu6eWFBQR9K7fsjXwHMmby3D3X6Yx-2BxcDcdRruTG" target="_blank">Canstar</a>, if there is a cut in February, a borrower with a $600,000 loan today and 25 years remaining would see their monthly repayments drop by $92.&nbsp;

<table border="1" cellpadding="0" cellspacing="0">
	<tbody>
		<tr>
			<td colspan="3">
			Impact of 0.25% pt cut in February 2025
			</td>
		</tr>
		<tr>
			<td>
			Current loan size
			</td>
			<td>
			Drop in monthly repayment
			</td>
			<td>
			New monthly repayment
			</td>
		</tr>
		<tr>
			<td>
			$600,000
			</td>
			<td>
			-$92
			</td>
			<td>
			$3,907
			</td>
		</tr>
		<tr>
			<td>
			$750,000
			</td>
			<td>
			-$114
			</td>
			<td>
			$4,884
			</td>
		</tr>
		<tr>
			<td>
			$1M
			</td>
			<td>
			-$153
			</td>
			<td>
			$6,512
			</td>
		</tr>
		<tr>
			<td colspan="3">
			Source:&nbsp;<a data-saferedirecturl="https://www.google.com/url?q=https://link.mediaoutreach.meltwater.com/ls/click?upn%3Du001.xWMOP9hChsvn-2BC9O-2FebBihXIZ4cEzbiuENdxm-2Bx3-2FYEEgYMhZlKWNj5Zzy1YZ56RuASD_RgrM7qq-2BfK-2FtAHeRBLv5Qrb-2Bii5fzjLeKcP4w-2FkNgJPXygpiRhVUan3WV3QEggcf617UC8Z60RjQJZAqx7PiO7FtVJQSn0D46Zc3iTVP0kAhTTzG51cPpa5hrqz1OkSA-2BiXAxUajQ686MTtiseWBIdMdknd83aB7cOVgXlVTeHCGf3-2BcMHwfvI8TYlkUovqEhn4dj0KXf2eJGpb9-2BBv20v2akwr6-2BqLyRrlEgkJ4J-2BCCyY0x189xEHZA4Ylf8c7ChBqNIkhmftZzoFuZKFn43pw3oJVg2o1gumrpdA-2B7MB-2FBtmL2rFCI-2FXORATQHySCLVOMg7Vywv-2BqnnQUAtDz6XkvpwxdHFXh70VwKazzhJsICilEYOvP4ju0sIfi5g6TL&amp;source=gmail&amp;ust=1727774368149000&amp;usg=AOvVaw2qVnp6oqATgqDUi2Frm22q" href="https://link.mediaoutreach.meltwater.com/ls/click?upn=u001.xWMOP9hChsvn-2BC9O-2FebBihXIZ4cEzbiuENdxm-2Bx3-2FYEEgYMhZlKWNj5Zzy1YZ56RuASD_RgrM7qq-2BfK-2FtAHeRBLv5Qrb-2Bii5fzjLeKcP4w-2FkNgJPXygpiRhVUan3WV3QEggcf617UC8Z60RjQJZAqx7PiO7FtVJQSn0D46Zc3iTVP0kAhTTzG51cPpa5hrqz1OkSA-2BiXAxUajQ686MTtiseWBIdMdknd83aB7cOVgXlVTeHCGf3-2BcMHwfvI8TYlkUovqEhn4dj0KXf2eJGpb9-2BBv20v2akwr6-2BqLyRrlEgkJ4J-2BCCyY0x189xEHZA4Ylf8c7ChBqNIkhmftZzoFuZKFn43pw3oJVg2o1gumrpdA-2B7MB-2FBtmL2rFCI-2FXORATQHySCLVOMg7Vywv-2BqnnQUAtDz6XkvpwxdHFXh70VwKazzhJsICilEYOvP4ju0sIfi5g6TL" target="_blank">www.canstar.com.au</a>. Starting rate is the RBA existing average owner-occupier variable rate of 6.36%. Assumes banks pass the cash rate cut on in full the month after the meeting.
			</td>
		</tr>
	</tbody>
</table>

Canstar Data Insights Director, Sally Tindall, says if core inflation continues to track in the right direction, or unemployment starts to accelerate significantly, we could well see a cash rate cut as early as February of next year.

“All four big banks now believe the RBA will be ready to cut the cash rate in just over four months’ time, if not before, in the case of CBA.

“However, the outlook for both inflation and unemployment is still highly uncertain. A couple of wobbly sets of inflation data could see the RBA holding for longer, particularly if unemployment remains relatively steady."

&nbsp;

Commonwealth Bank, the nation's largest lender, still thinks the first cut will come in December.

NAB bring forward first RBA cut to February 2025

<html><body>
The RBA held rates steady at its December meeting at 2 per cent at its last board meeting of the year.
<div>Borrowers disappointed by the RBA’s decision to keep interest rates on hold can still get an early Christmas rate cut on their home loan by haggling their lender for a better deal, according to <a href="https://mozo.com.au/" target="_blank">Mozo.com.au</a>. 
</div>
<div>In a recent mystery shopping exercise, Mozo staff posing as borrowers were able to haggle huge discounts of up to 1.25% off the standard variable home loan rate, simply by calling up the banks and asking. “The Big 4 are competing more fiercely for owner occupiers in the wake of the crackdown on investor lending, with discounts on offer to these borrowers the biggest we’ve seen,” said Mozo Director Kirsty Lamont. Mozo data shows that by haggling 1.25% off the average standard variable rate, borrowers could save $223 a month on their repayments on a $300,000, 30-year loan. “When pushed banks are prepared to offer better discounts beyond their advertised home loan deals which can lead to savings of $2676 each year for borrowers,” said Lamont.</div>
The REINSW President John Cunningham said the announcement was largely expected.  “This decision adds weight to a good stabilisation of the market into the New Year,” Mr Cunningham said.
Slower housing market conditions were likely a topic of conversation when the Reserve Bank board met today to deliberate on the cash rate setting. 
CoreLogic RP Data reported today a 1.5% fall in capital city dwelling values over the month of November and a 0.5% fall over in values over the past three months. 
"While the cash rate remained on hold, a less buoyant housing market is likely to provide the Reserve Bank with a greater degree of flexibility in adjusting interest rates without as much risk of over stimulating the housing market as what they have faced over previous months.
"While the Reserve Bank is likely to welcome a slowdown in the rate of home value appreciation, the overriding objective would be to avoid a significant downturn in the housing market, which would act as a weight on economic growth and potentially impact financial system stability," CoreLogic RP Data research head Tim Lawless said.
" Despite the stable rate setting, mortgage rates remain close to record lows which should continue to act as an incentive for home buyers and investors considering a property purchase," he added.
While today’s RBA decision to leave interest rates on hold has surprised no-one, Laing+Simmons managing director Leanne Pilkington said the cash rate is one of few steady elements in a housing market that has otherwise undergone recent change.
“The market for residential property has undergone a noticeable shift in recent months, with conditions moving toward a greater equilibrium between buyers and sellers, as opposed to the vendor favourable conditions earlier in the year,” Ms Pilkington said.
“The record clearance rates, low stock levels and rapidly increasing prices which characterised the first half of 2015 have now subsided somewhat as buyers exercise greater caution.
 “Demand remains robust, but we do not expect the double digit price growth of 2015 to be repeated in the year ahead,” she said.
The Reserve Bank of Australia (RBA) will continue to walk the interest rate tightrope over the summer as it considers a mixed bag of economic data, says mortgage broker John Kolenda adding it was no surprise to see the RBA following its final deliberation of 2015 leave official rates at the record low of 2.0 per cent.
But Mr Kolenda said a further rate cut is highly likely in the first half of 2016.
“The RBA has been a walking a tightrope leaving rates on hold since May this year due to the mixed economic data,” he said.
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RBA holds rates steady at December meeting

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Statement by Glenn Stevens, Governor: Monetary Policy Decision
<h3 id="mr-title">Statement by Glenn Stevens, Governor: Monetary Policy Decision</h3>
At its meeting today, the Board decided to leave the cash rate unchanged at 2.0 per cent.
The global economy is expanding at a moderate pace, with some softening in conditions in the Asian region, continuing US growth and a recovery in Europe. Key commodity prices are much lower than a year ago, reflecting increased supply, including from Australia, as well as weaker demand. Australia's terms of trade are falling.
The Federal Reserve is expected to start increasing its policy rate over the period ahead, but some other major central banks are continuing to ease monetary policy. Volatility in financial markets has abated somewhat for the moment. While credit costs for some emerging market countries remain higher than a year ago, global financial conditions overall remain very accommodative.
In Australia, the available information suggests that moderate expansion in the economy continues in the face of a large decline in capital spending in the mining sector. While GDP growth has been somewhat below longer-term averages for some time, business surveys suggest a gradual improvement in conditions in non-mining sectors over the past year. This has been accompanied by stronger growth in employment and a steady rate of unemployment.
Inflation is low and should remain so, with the economy likely to have a degree of spare capacity for some time yet. Inflation is forecast to be consistent with the target over the next one to two years.
In such circumstances, monetary policy needs to be accommodative. Low interest rates are acting to support borrowing and spending. While the recent changes to some lending rates for housing will reduce this support slightly, overall conditions are still quite accommodative. Credit growth has increased a little over recent months, with credit provided by intermediaries to businesses picking up. Growth in lending to investors in the housing market has eased. Supervisory measures are helping to contain risks that may arise from the housing market.
The pace of growth in dwelling prices has moderated in Melbourne and Sydney over recent months and has remained mostly subdued in other cities. In other asset markets, prices for commercial property have been supported by lower long-term interest rates, while equity prices have moved in parallel with developments in global markets. The Australian dollar is adjusting to the significant declines in key commodity prices.
At today's meeting the Board again judged that the prospects for an improvement in economic conditions had firmed a little over recent months and that leaving the cash rate unchanged was appropriate. Members also observed that the outlook for inflation may afford scope for further easing of policy, should that be appropriate to lend support to demand. The Board will continue to assess the outlook, and hence whether the current stance of policy will most effectively foster sustainable growth and inflation consistent with the target.
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Unchanged: RBA Governor Glenn Stevens' December 2015 meeting statement

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GUEST OBSERVER
The big drop in the Australian unemployment rate grabbed the headline this week. Headline inflation, at 1.5% (year-on-year) below the RBA’s target band of 2-3%, remains well contained and GDP growth, at 2% annualized, soft.
The CAMA RBA Shadow Board on balance prefers to keep the cash rate on hold, attaching a 67% probability to this being the appropriate policy setting. The confidence attached to a required rate cut equals 22%, down four percentage points from the previous month, while the confidence in a required rate hike has risen slightly to 11%.
According to the Australian Bureau of Statistics, Australia’s unemployment rate fell in October from 6.2% to 5.9% though the accuracy of recent ABS numbers is questionable. Employment, both full time and part time, has expanded and the participation rate reversed its recent decline. These are all positive signs.
The Aussie dollar continues to trade around 72 US¢. Yields on Australian 10-year government bonds have risen, most recently to 2.82%.
The outlook for the Australian property market has not changed appreciably. At this stage, it appears that the property market is cooling gently, preparing for a soft landing, rather than an abrupt correction. As predicted, the S&amp;P/ASX200 continues to move sideways around the 5200 mark.
Global markets are preparing for the US Federal Reserve to raise the federal funds rate during its last FOMC meeting of the year. Given the most recent rhetoric by the Federal Reserve Bank Governor Janet Yellen, this looks more likely than ever. Recent US growth data have surprised on the upside and other US economic indicators point to a healthy economic expansion. On the other hand there remain risks to the global economy. These include geopolitical tensions, following the terrorist attacks in Paris, as well as economic risks associated with emerging countries’ excessive debt levels.
Consumer and producer sentiment measures continue to paint a motley picture. After successive drops, the Westpac/Melbourne Institute Consumer Sentiment Index rose for a second month in a row, to 102 in November, from 97.8 in October. Business confidence, according to the NAB business survey slid further, fell again, from 5 to 2. The AIG manufacturing and services indices, leading economic indicators, both fell.
The Shadow Board’s confidence that the cash rate should remain at its current level edged up from 65% in November to 67%. After last month’s noticeable shift, the confidence that a rate cut is appropriate has dropped again to 22% (26% in November); the confidence that a rate increase, to 2.25% or higher, is necessary has risen to 11% (9% in November).
The probabilities at longer horizons are as follows: 6 months out, the estimated probability that the cash rate should remain at 2% is nearly unchanged at 23% (24% in November). The estimated need for an interest rate increase has slightly increased, to 60% (58% in November), while the need for a rate decrease has slipped to 17% (19% in November). A year out, the Shadow Board members’ confidence that the cash rate should be held steady is unchanged at 18%, while the confidence in a required cash rate increase equals 67% (unchanged from November) and in a required cash rate decrease 16% (15% in November).
<a href="/images/2015/12/1/Screen%20Shot%202015-12-01%20at%209.42.19%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2015/12/1/Screen%20Shot%202015-12-01%20at%209.42.19%20AM.png" alt="" width="747" height="443">
To see the report in full, <a href="https://cama.crawford.anu.edu.au/rba-shadow-board/outcome/2015-12" target="_blank">click here</a>.
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jchancellor-FAypfDUnLy

No need for holiday season rate cut: RBA Shadow Board

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GUEST OBSERVER
The RBA is clearly set to remain on hold next week. This was made clear in a recent speech by Governor Stevens, when, rather unusually, he gave fairly clear guidance on the near-term outlook for rates. 
When asked about whether he was ‘still content with a 2.00% cash rate’ or whether the central bank was ‘going to surprise us all again next February’, he said that, “February is three months away, we’ve got Christmas, we should just chill out… come back… and see what the data says.”
December is seemingly not even in consideration.
So if December is out: what about February?
One thing is clear: the RBA does not want to cut further. Otherwise, it would have done so already. Inflation is low and the central bank is forecasting it to stay low over coming quarters. At the same time, the RBA is forecasting growth to remain below trend until late 2016 and the unemployment rate to stay high over the next two years. The RBA is clearly patient and has set a high bar for delivering any further stimulus.
Between now and February there is also a large number of significant local and global events. Local Q3 GDP data arrive next week and are expected to be on the stronger side. Local jobs numbers come after that and will be worth watching, given the surprisingly strong October result. The Fed’s meeting in mid-December will be important, particularly its implications for the AUD: if the Fed hikes, but delivers a dovish message, the AUD may not fall as many are hoping. At the same time, commodity prices have fallen in recent weeks, as the Chinese slowdown has continued. Finally, the next local CPI print, due on 27 January 2016, will be critical.
We remain optimistic about local growth, but pessimistic about the global inflation outlook. Given low inflation, our central case has the RBA delivering another cut early next year, but there is significant uncertainty, given the large collection of events between now and then, and the RBA’s considerable reluctance about considering the prospect of further cuts.
<a href="/images/2015/11/26/Screen%20Shot%202015-11-27%20at%2011.40.51%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2015/11/26/Screen%20Shot%202015-11-27%20at%2011.40.51%20AM.png" alt="" width="760" height="339"> 
 
 
Growth is lifting, as the rebalancing act continues
 
Timely indicators of economic conditions continue to suggest that Australia’s growth is lifting.
 
The NAB business survey, which the RBA has put significant focus on recently in its commentary, shows that business conditions are at around five-year highs (Chart 1). The NAB survey has also shown a further pick-up in capacity utilisation, although business confidence ticked down recently and remains below average. The improvement in business conditions has been led by the services sectors, as growth rebalances away from mining (Chart 2).
 
Jobs growth is also being driven by services sector employment. The recent lift in jobs growth has seen the unemployment rate tick down to 5.9%, which is its lowest level since April 2014
 
(Chart 3). Although the official labour market numbers have been subject to significant measurement issues recently, the collection of labour market indicators suggests gradual improvement in labour market conditions. Job advertisements, job vacancies, internet vacancies and the business surveys have also shown a gradual trend improvement in recent months.
 
Q3 GDP, which is due to be published next week (2 December), is expected to show a solid lift in the quarter, following the weak print in Q2 (Chart 4). A key support for growth is expected to come from net exports, with preliminary numbers showing a strong rise in exports and falling imports. Resources exports are ramping up as new capacity comes on line and coal exports rebound after weather-related disruptions in Q2. Domestic demand is expected to be modest with solid growth in household consumption and housing construction more than offsetting the effect of a sharp fall in mining investment.
<a href="/images/2015/11/26/Screen%20Shot%202015-11-27%20at%2011.43.26%20AM.png" target="_blank">Click to enlarge</a>
 <img src="/images/2015/11/26/Screen%20Shot%202015-11-27%20at%2011.43.26%20AM.png" alt="" width="776" height="389">
<a href="/images/2015/11/26/Screen%20Shot%202015-11-27%20at%2011.44.32%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2015/11/26/Screen%20Shot%202015-11-27%20at%2011.44.32%20AM.png" alt="" width="776" height="351">
 
Inflation is low and expected to stay there for some time
Although growth is picking up, inflation is low. This partly reflects that growth has been below trend for the past three years and the unemployment rate remains at a level that is well above full employment (around 5-5.25%). This has dampened wages growth and kept domestic price pressures at bay.
This month brought the wage price index, which showed that wages growth remains at its slowest pace in at least 18 years (Chart 5). The wage price index showed growth of 2.3% y-o-y in Q3, unchanged from Q2. However, growth in the private sector wage price index fell to a new record low of 2.1% y-o-y. Real wages have been broadly flat for the past two years.
Low wages growth is contributing to low inflation, with the underlying measures of inflation having surprised on the downside in Q3. Underlying inflation was running at 2.2% y-o-y in the Q3, which is near the bottom edge of the RBA’s 2-3% target band. Our own modelling, which is based on the RBA’s own work-horse models and using similar assumptions to the central bank, show that underlying inflation is expected to skirt the bottom edge of the target band over coming quarters (Chart 6). 
Considerable reluctance to cut
With growth running below its trend pace, the unemployment rate still well above its full employment level and underlying inflation at the lower edge of the target band, the RBA has scope to cut interest rates further, if it deems that this is needed. As Governor Stevens pointed out in a recent key speech, the RBA is “more than content to lower [the cash rate] if that actually helps”. At the same time, given the recent lift in business conditions and improving labour market, the RBA appears to have considerable reluctance to cut further. Part of this reflects that monetary policy is clearly doing what it is supposed to do and the RBA clearly sees the costs of a further cut outweighing the benefits at this stage.
One of these costs is financial stability. The central bank’s recent financial stability review suggested that the RBA remains concerned about potentially over-inflating the Sydney and
Melbourne housing markets, which have both seen significant housing price growth in recent years. The RBA has also recently expressed concerns about potential over-building in the housing and commercial property markets in some cities. Notably, there are signs that the housing market is cooling, particularly in Sydney, which may reduce the RBA’s concerns about financial stability issues over time (Chart 7).
<a href="/images/2015/11/26/Screen%20Shot%202015-11-27%20at%2011.47.20%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2015/11/26/Screen%20Shot%202015-11-27%20at%2011.47.20%20AM.png" alt="">
 
The RBA’s reluctance to cut further may also reflect timing and uncertainty. The RBA’s recent official statement emphasised a large number of risks at the current juncture.
One risk is what path the Fed might take in coming months and what that could mean for the AUD. The chances of Fed ‘lift-off’ this year have risen in recent weeks, particularly following the strong payrolls numbers for October. Although this could put some downward pressure on the AUD, much depends on the Fed’s subsequent path for rates. If the AUD falls noticeably from here, this could help to lift inflation faster, which could help the RBA hit its target. However, if the Fed’s commentary is more dovish the AUD could rise, putting further downward pressure on already low Australian inflation.
Another risk is what the slowdown in China will mean for commodity prices. The iron ore price has recently fallen to a 10-year low of around USD45 per tonne. The RBA has been content with the level of the AUD recently, partly because it had fallen in line with commodity prices and partly because there are clear signs that the lower AUD is lifting growth (Chart 8). If commodity prices were to fall further and the AUD rose, this could squeeze local income and become a concern for the RBA.
Importantly, we also get a swathe of local data for Australia before February. Next week we get Q3 GDP, which we expect to show solid growth (0.8% q-o-q and 2.5% y-o-y). The following week we get official labour market numbers for November, which will be of particular interest, given the strong result in October. Another critical piece of information ahead of the February RBA meeting will be Q4 CPI print, which is due on 27 January 2016. A low CPI print could encourage the RBA to cut further, although the central bank’s own forecasts already anticipate underlying inflation of 2.0% y-o-y, so it would take a weak result to surprise the RBA to the downside.
 
<a href="https://www.about.hsbc.com.au/hsbc-in-australia/management-team" target="_blank">PAUL BLOXHAM</a> IS CHIEF ECONOMIST (AUSTRALIA AND NEW ZEALAND) FOR HSBC. 
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RBA chilling out for Christmas: HSBC's Paul Bloxham

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Leading experts and economists are unanimous in expecting the cash rate will remain on hold at 2%, according to the comparison website, finder.com.au monthly survey.
All 33 commentators in the <a href="https://www.finder.com.au/rba-cash-rate" target="_blank">finder.com.au Reserve Bank Survey</a>, the biggest of its kind in Australia, believe there will be no change to the cash rate, with most of the panel citing an improving economy as the likely factor behind the RBA’s decision to keep the cash rate on hold.
However five of 33 are predicting a rate drop in February, the first Reserve Bank meeting of 2016 – Shane Oliver, AMP Capital; Richard Robinson, BIS Shrapnel; Paul Bloxham, HSBC; Matthew Peter QIC; and Noel Whittaker, QUT.
Around three in five experts surveyed (58%) are believing the cash rate will not rise for at least the next 12 months.
Experts were divided when it came to the future behaviour of house prices; while almost three in five experts (58 percent) are predicting property prices to rise in 2016, 29 percent believe prices will drop next year.
Some 38% of experts predict a decrease in demand for residential property in 2016, while 34% predict an increase in demand. Almost half of these experts (45%) are also expecting rents to rise next year, while 42% say rents will remain the same and 13% think the rental market could lose steam with rents to fall.
“This indicates that, regardless of demand, property prices as well as rent are expected to rise in value in 2016, which is great news for property owners but less so for those looking to break into the ever-competitive market,” Bessie Hassan at finder.com.au suggested.
“The message here is, it’s not expected to get any easier, which is why it’s more important than ever to make sure you do your homework when it comes to researching home loans. Jump online and compare interest rates and product offerings, and get a pre-approval to put yourself in the best position to become a property owner in 2016.”
What the experts had to say in the <a href="https://finder.com.au/" target="_blank">finder.com.au</a> Monthly Reserve Bank Survey:
Melissa Browne, A+TA: "I don't believe there's a case to cut rates at present and certainly no reason to move them upwards."
Shane Oliver, AMP Capital: "Reserve Bank has continued to express comfort with current levels in view of the rebalancing of the economy. Strong October jobs data have likely reinforced this.", "While I checked "house prices may keep rising" in question 6, I expect their rate of increase to slow significantly."
Garry Shilson-Josling, Australian Associated Press: "There is enough evidence that the long-awaited 'rebalancing' is under way for the RBA to sit back and wait.", "The RBA will be looking closely at the employment figures (released November 12). Most likely it will conclude that the labour market really is strengthening, and that while the big rise in employment in October rise incorporated some 'catch-up' from a suspiciously weak September figure, jobs growth may be trending now around 25,000 a month, up from about 16,000 a month over the year to June and 5,000 a month over the previous 12 months."
Peter Munckton, Bank of Queensland: "The RBA is comfortable with the current level of interest rates"
Steven Pambris, Bank Of Sydney: "Will need to refrain at this point as unemployment figures are showing signs of improvement, so will need to hold."
Richard Robinson, BIS Shrapnel: "Strong employment data in Oct and consumer confidence in Nov means they can wait."
Chris Caton, BTFG: "No reason to change."
Michael Blythe, CBA: "Economy does not need any additional stimulus."
Savanth Sebastian, Commsec: "Comfortable about how the economy is evolving. Lower inflation forecasts opens the door for a further rate cut but RBA in wait and see mode."
Dr Andrew Wilson, <a href="https://domain.com.au/" target="_blank">Domain.com.au</a>: "Better unemployment data, better stockmarket, waiting for US decision on interest rates."
Mark Brimble, Griffith University: "Bias remains to the downward movement, however insufficient support for a move at this stage. The equity markets are recovering, property remains buoyant, employment is holding... essentially it is a bit of a wait and see as the economy is delicately balanced."
Paul Williams, Heritage Bank: "Reserve Bank seems comfortable to adopt a wait and see approach to interest rates for the time being."
Shane Garrett, HIA: "Stronger employment numbers and modest inflation."
Paul Bloxham, HSBC: “We’re seeing rates hold at 2% [in December].”
Michael Witts, ING Bank: "The economy is heading in the right direction in terms of what the Reserve Bank is expecting. The recent labour force data means that the Reserve Bank will be on the sidelines for an extended period."
Stephen Koukoulas, Market Economics: "Earlier rate cuts and the low Aussie dollar is filtering into a pickup in economic activity. Further rate cuts are simply not needed.", "The economy is ending 2015 on a more positive note and while conditions globally are fragile, the prospects for the Australian economy to register 3% real GDP growth seem strong."
Peter Jones, Master Builders: "There is sufficient stimulus."
John Caelli, ME: "The Reserve Bank will keep the powder dry until they see very clear signs of the need to stimulate the economy. Stronger than expected employment data mean there is no compelling reason to cut rates in December."
Mark Crosby, Melbourne Business School: "No pressure to raise and with Fed likely to raise no reason to cut either.", "Property market pressures are likely to be localised. still strength in Sydney but weakness in Melbourne high rise."
Katrina Ell, Moody's Analytics: "The Reserve Bank seems comfortable on the sidelines with domestic demand gradually on the mend and the lower Australian dollar starting to do the heavy lifting getting the economy back on track."
Jessica Darnbrough, Mortgage Choice: "Consumer sentiment is currently sitting at it highest level since January 2014. Similarly, business conditions remain relatively robust, giving the Reserve Bank no immediate reason to change the current monetary policy setting."
Chris Schade, MyState Bank: "Conditions in the economy do not presently warrant a rate cut and indeed we've seen some promising signs of improvement recently. Whilst there are some risks to the downside in CY 2016, particularly in the back half, our read is the most likely scenario is that we have reached the bottom and the cash hold will remain on hold for most if not all of CY 2016."
Saul Eslake, independent economist : "Data released since the last meeting has further reduced the perceived need for providing further monetary policy stimulus to domestic demand."
Alan Oster, NAB: "Economy improving."
Peter Boehm, <a href="https://onthehouse.com.au/" target="_blank">onthehouse.com.au</a>: "There does not appear to be a pressing need to drop rates further. A steady as she goes approach would appear to be the prudent way to go to close out 2015. The housing market, inflation, unemployment, the Australian dollar’s exchange rate and the economic and business outlook all seem reasonably positive and a further rate reduction would be unlikely to yield much benefit and leave the Reserve Bank very little room to move if, in the unlikely event, it was deemed necessary to reduce rates further next year."
Linda Phillips, Propell Ltd A JLL Company: "The Reserve Bank must be comfortable with the exchange rate around US$0.71. House price rises in Sydney are slowing, which will be regarded as welcome, but growth is accelerating in Melbourne. While the global outlook is uncertain, it is expected that the Fed will soon start increasing US rates, which will limit the capacity for the Reserve Bank to move on the downside. Some domestic indicators such as unemployment are improving, and the Reserve Bank is reporting a somewhat better outlook. While the markets would like to see rates fall 25bp to offset the mortgage price hikes by the banks last month, on the whole it is likely that the Reserve Bank will be comfortable in waiting until February before making any decision to change rates… The level of volatility in global markets, problems of debt management in developing countries, the threat of expansion of the wars against IS, and uncertainty within the Euro-zone, the latest concern being Portugal, have the potential to upset the base case outlook of a slow but steady improvement in the economy. The risk of "black swan events" is rising, and volatility is likely to remain high."
Jonathan Chancellor, Property Observer: "It is timely to wait and see."
Matthew Peter, QIC: "Having not moved in November, the Reserve Bank will sit and wait for global and domestic developments. A February rate cut is still an option if global conditions deteriorate (especially if the Fed delays lift off)."
Noel Whittaker, QUT: "Mixed economic indicators. With mixed signals in the economy, I think the Reserve Bank is likely to sit pat."
Janu Chan, St.George Bank: "The Reserve Bank is encouraged by signs that the economy will continue to improve so it sees little need at this point to lower rates any further. "Housing market is still likely to face mixed conditions across the country."
Scott Haslem, UBS: "We recently (briefly) flirted with the notion the Reserve Bank could ease again, largely to offset regulatory-driven out-of-cycle hikes by banks. While Reserve Bank's Stevens recently assessed those moves to be worth about half a 25bp hike, it seems given recent better domestic data, including business/consumer confidence and solid jobs trends, the Reserve Bank sees the economy as able to 'cope' with that half-a-hike."
Nicki Hutley, Urbis: "On balance, monetary policy is sufficiently easy to continue to stimulate growth."
Bill Evans, Westpac: "Commentary on the labour market remains positive. Lead indicators such as job vacancies and advertisements continue to point to a lift in employment while there has been a “noticeable increase in the participation rate”. However these offsetting factors mean that the unemployment rate will not fall “for more than a year” before declining gradually."
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No December RBA rate cut: finder.com.au survey

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Borrowers are being encouraged to take advantage of some of the lowest home loan rates in history by shopping around, following a survey by comparison website, <a href="https://www.finder.com.au/" target="_blank">finder.com.au</a>, which found about two in five mortgage holders.
It found 39% of borrowers have not switched providers in the past decade – an estimated 1.17 million households.
"By not switching home loans or asking for a discount with their current lender, these households are potentially wasting a combined $27.4 million per month, $328.2 million per year or a staggering $9.9 billion over 30 years," <a href="https://www.finder.com.au/" target="_blank">finder.com.au</a> consumer advocate, Bessie Hassan said.
She said she was surprised by the complacency of many borrowers.
The survey of 1,351 respondents also found that just 6% of Australians are currently considering switching providers, while just 21% have switched for a better deal within the last five years.
More than half of these borrowers (54%) are content with their lender, while almost one in four (24 percent) hadn’t switched because they couldn’t find the time for all the paperwork.
One in 10 found it too hard to compare products and 13% think it would cost too much.
Comparing generations, Gen Y (18-34 year-olds) were the most savvy, more likely to have switched home loans than any other age group, while Baby Boomers (aged 55-74) were the most loyal to their lender.
Refinanced loans represent 34% of all home loans financed, according to the Australian Bureau of Statistics Housing Finance data analysed by <a href="https://www.finder.com.au/" target="_blank">finder.com.au</a>.
"That figure has fluctuated between 31 and 34% since the credit reforms were introduced in July 2012, which made it easier for variable rate borrowers to switch providers," Bessie Hassan said.
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Lazy $9.9bn cost as baby boomer borrowers most loyal to the lender: finder.com.au

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GUEST OBSERVER
RBA Governor Glenn Stevens spoke at an Australian Business Economists dinner and offered a long term look of the big forces, many of them negative, impacting the economic outlook.
When asked about the short term policy outlook, and particularly the February RBA board meeting, Stevens said we should just "chill out" over Christmas and "come back and see what the data say".
Stevens' speech was less positive than the "glass half full" varieties that had been given as recently as 13 October by Deputy Governor Philip Lowe. But his comments were in line with the recent Statement on Monetary Policy in which the RBA's growth and inflation forecasts were lowered.
Crucial to the RBA over the holiday period will be the outcome of the US central bank policy meeting on 16-17 December, the next two Australian labour force reports and the December quarter CPI due on 27 January.
Subject to surprises from those events (especially a continuation of strong employment growth) we maintain our view that in 2016, the Australian economy will be less assisted by 2015's tailwinds. The stimulus from housing and the lower AUD will fade. We also think consumption growth is unlikely to be as strong as the RBA currently forecasts. 
We think the inflation outlook provides no impediment to lower rates. And so, we expect the RBA will implement more cuts. As Stevens said tonight, if growth can be dialled-up to wind-in the economy's spare capacity and "make things better", further rate cuts are appropriate. We maintain our view that cash rate will be cut twice by 25bps, most likely in February and May.
Governor Stevens' speech followed an address by Deputy Secretary of the Treasury, Nigel Ray today at the same conference who said that updated population and labour force trends would cause Treasury to downgrade the economy's potential growth. "We now think potential GDP will grow by around 2¾% over the next few years, lower than the 3% estimated at Budget."
This theme was also touched upon by Stevens who reiterated the known weight of the demographic change, but also noted costs such "as the problems of providing retirement incomes" because low yields on fixed income assets mean that it is expensive to purchase a secure stream of future income. He said "this may mean that Australian listed corporates feel the pressure from shareholders to deliver that, even some whose earnings are inherently volatile". 
Stevens also pointed to demographic changes in China, which "are not favourable" as China's total working-age population will shrink over the years ahead. He contrasted this with India where the working age population will exceed China's within a decade.
Other influences on growth highlighted by Stevens were;
The closing chapters of the terms of trade event.
Households no longer being able to lead growth by increasing leverage.
The global legacy effects of debt, after a period of over-confidence and under-appreciation of risk.
A disinflationary or deflationary environment for goods and commodities, and even some services, accompanied by unusually low rates of wages growth.
Extremely low returns on safe financial assets.
High and rising valuations on existing fixed assets.
 
Cherelle Murphy is co-head of Australian Economics, ANZ and can be contacted <a href="https://bluenotes.anz.com/authors/our-economists/" target="_blank">here</a>.
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RBA's Stevens and Treasury's Ray Sombre update on "Big Forces": Cherelle Murphy

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Thirteen lenders are predicted to increase variable rates for both owner occupiers and investors.
Analysis by RateCity, titled "Rate Hike Friday" predicts mortgage holders will be hit by an average of 0.17 percentage points or $372 per year on a $300,000 home loan.
<a href="/images/2015/11/20/Screen%20Shot%202015-11-20%20at%2010.34.20%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2015/11/20/Screen%20Shot%202015-11-20%20at%2010.34.20%20AM.png" alt="">
RateCity money editor Sally Tindall said just one bank, CUA, is dropping its basic variable rate for existing customers as well as new ones - a strike rate of 1%.
“We’ve identified least 24 lenders who have dropped their variable home loan rates in recent months – but there’s a catch – the overwhelming majority of these lenders will only give you the new deal if you’re a new customer,” she said.
“Loyalty has well and truly left the home loan market. If you want one of the lowest rates, the chances are you’ll have to switch."
<a href="/images/2015/11/20/Screen%20Shot%202015-11-20%20at%2010.33.56%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2015/11/20/Screen%20Shot%202015-11-20%20at%2010.33.56%20AM.png" alt="" width="837" height="407">
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Thirteen lenders predicted to increase variable rates

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Industry super fund-owned bank ME has reported an underlying net profit after tax of $60 million for FY2015, a rise of 27% on the previous reporting period.
The increase was driven by growth in home loan settlements, up 22 per cent to $4.6 billion, as well as disciplined management of net interest margin.
ME chief Jamie McPhee, said it was a strong performance.
ME’s cost-to-income ratio continued to fall, reducing 260 basis points to 68.5%.
McPhee said cost-to-income had been on a downward trajectory since June 2009 when the ratio was 84.5%.
Customer numbers grew 8% to 338,000 with customer deposits increased 7 per cent to $8.8 billion.
Total on and off balance sheet assets grew 7 per cent to $23.3 billion, with total loans on the balance sheet growing 19% year-on-year to $17.8 billion.
The broker sales channel surpassed $2.2 billion, up from $1.2 billion last year, an increase of 83%.
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ME Bank profit up 27%

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GUEST OBSERVER
A cash rate rise is coming to the Australian property market – experts are confident of that much.
When that rise will come, however, is a little unclear – 30% of respondents in the finder.com.au Reserve Bank Survey predict a rate move before the year is out, while more than half don’t expect any upward movements until at least 2017. In the meantime, we’re seeing out of cycle rate hikes hit the market, just weeks out from Christmas.
If you’ve been considering a home loan but haven’t yet made the plunge, now may be time to make the transition without worrying about further hikes.
Here are the lowest variable and 3-year fixed home loans on finder.com.au with no ongoing fees.
finder.com.au’s lowest variable rate home loans with no ongoing fees
1.     Mortgage House Summer Home Loan: 3.79%
This low rate is available for a 12 month period, at which point the rate will revert to 3.99%. It allows for a 100% offset account, the benefit of no application fees and additional repayment and redraw features. Provided you’ve braced for the $200 settlement, $450 discharge and $395 legal fees.
2.     Reduce Home Loans Rate Buster Fee Free: 3.85%
If you’re the type of person who can save a 30% deposit and still have a little left over to foot the $440 application and $130 settlement fees, this loan is a worthy contender among your options. The 100% offset account, repayment and redraw facilities as well as splitting options all give you the tools to create a formidable financial product. 
3.     loans.com.au Essentials Home Loan: 3.98%
While you won’t be accessing a 100% offset account  with this loan, you can put ongoing, legal and application fees worries to rest. This is particularly powerful when paired with the ability to make unlimited additional repayments, slicing interest off your mortgage. Just have your 20% deposit saved up, as you’ll only be able to borrow up to 80% of the total property value.
 
finder.com.au’s lowest 3-year fixed home loans with no ongoing fees
1.     Newcastle Permanent Fixed Rate Home Loan: 3.89%
This loan is not only a super low rate but it’s fee-friendly – there’s no application, legal, valuation or settlement fees. You can also make additional payments to this loan but beware, as you will not be able to access this money once you do decide to make those deposits.
 2.     CUA Fixed Rate Home Loan: 4.09%
This low rate comes with a high application fee, but don’t be disheartened by the $600 application tag – this loan has some great cushions to soften the blow. With no valuation fees, the ability to make additional repayments (capped at three repayments for the fixed period) and the ability to switch into interest only options, this flexible number can get your house on its feet sooner, provided you manage it well.
3.     Australian Unity Health, Wealth and Happiness Fixed Rate Package: 4.15%
If you can swallow a $600 settlement fee, don’t need to borrow more than 90% and are okay with no 100% offset account, this home loan is a serious heavyweight in the fixed space. With no application, legal or valuation fees and the ability to redraw your extra deposits, there is still quite a bit of breathing space in this low rate loan.
 
MICHELLE HUTCHISON is spokesperson for comparison website <a href="https://finder.com.au/" target="_blank">finder.com.au</a>.
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