<a href="https://www.apartments.com.au/developers/s-p-setia">SP Setia</a> has lodged plans for a $750 million, three-tower mixed-use precinct that would complete the long-running redevelopment of Carlton's former Carlton United Breweries site.

The proposal at <a href="https://www.apartments.com.au/new-apartments/185-195-queensberry-street-carlton-vic-3053">46-78 Bouverie Street and 185-195 Queensberry Street</a> spans a 6,468 sqm site, the last remaining undeveloped parcels within the former brewery's 2007 masterplan.

Designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, the development will comprise two purpose-built student accommodation towers and a third build-to-sell apartment tower above a shared commercial podium and basement.

Across the three towers, SP Setia is proposing 606 build-to-sell apartments and 1,499 student accommodation units containing 2,009 beds.

The apartments will sit in the tallest tower, which will rise nearly 200m and 55 storeys. It will become&nbsp;one of the more substantial new build-to-sell apartment projects at the northern edge of Melbourne's CBD.

The apartment mix is weighted toward smaller inner-city product, with 188 studios, 206 one-bedroom apartments, 192 two-bedroom apartments and 20 three-bedroom apartments

<img alt="First look: SP Setia plans three-tower finale for Carlton’s former CUB precinct" data-entity-type="file" data-entity-uuid="8271bc87-1b0a-41b7-ac73-a425ee375261" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/3_2.png?VersionId=G4lw23o90B1boX4k4dj7rdz2ZEajS9wy" />

Part of the precinct will be a large-scale&nbsp;3,684 sqm supermarket and a further 2,198 sqm of speciality retail, creating close to 5,900 sqm of new commercial space within the precinct.

But one of the biggest components of the proposal is what sits between the buildings.

Around 4,650 sqm, or roughly 72 per cent of the site, will be publicly accessible open space, incorporating plazas, pedestrian connections, landscaped laneways and retail spill-out areas.

The ground plane is intended to finally complete pedestrian connections envisaged when the CUB masterplan was first approved nearly two decades ago, stitching together Victoria Street, Queensberry Street, Bouverie Street and Swanston Street through the former brewery precinct.

Urbis said the development would "complete the CUB precinct", with the public realm providing important north-south and east-west connections through what is currently the final undeveloped portion of the masterplanned site.

SP Setia is also exploring a new linear park within the Bouverie Street road reserve, with the concept to be developed further with the City of Melbourne through the planning process.

The proposal is being pursued through the Victorian Government's Development Facilitation Program under Clause 53.23 for significant residential development with affordable housing.

The planning report acknowledges the proposed heights exceed those contemplated under the original Comprehensive Development Plan and masterplan, but argues the built-form context has changed considerably over the past two decades.

Urbis said the three towers would instead create a stepped transition between Carlton and the Hoddle Grid, rising progressively from the 94.1-metre Tower One along the Queensberry Street edge to the 199.44-metre Tower Three closer to the established CBD-scale buildings to the south.

<img alt="SP Setia" data-entity-type="file" data-entity-uuid="e885a07a-592c-40fc-bf82-e6dbaf32da54" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.52.24%E2%80%AFAM.png?VersionId=7s_ErUkSKAdY1mAWp3GRZgMNCGtwhk5m" />

SP Setia plans to deliver the development across three stages.

Stage One would deliver the basement, podium and retail areas for the entire precinct alongside the first student tower. Tower Two would follow in Stage Two, before the 606-apartment Tower Three is delivered as the final stage.

If approved and delivered, the project would close out a redevelopment process that has been underway since the former brewery masterplan was approved in 2007, adding more than 2,600 student beds and apartments to a precinct already home to Swanston Central, the Barak Building, RMIT Design Hub and several large student accommodation developments.

&nbsp;

&nbsp;

Joel Robinson

SP Setia plans three-tower finale for Carlton’s former CUB precinct

Melbourne developer Lowe Living is seeking to add to its growing bayside apartment pipeline, filing plans for a boutique eight-residence development in tightly held Middle Park.

Lowe Living, which has built much of its development portfolio across Melbourne's affluent bayside and south-east suburbs, is behind the plans for the 730 sqm site at <a href="https://www.apartments.com.au/new-apartments/123-125-erskine-street-middle-park-vic-3206">123-125 Erskine Street</a>, just off Armstrong Street and within the Armstrong Street Neighbourhood Activity Centre.

The developer is seeking approval for a five-storey residential building above two basement levels, with just eight large-format apartments and 18 car spaces.

“This is a deliberately very different proposition for us,"&nbsp;Tim Lowe, Co-Founder of Lowe Living, said.

"Eight residences is exceptionally boutique, but that's precisely what this site calls for.

“There is a strong community in Middle Park and the surrounding suburbs who have spent decades building a life here. They no longer want the maintenance of a large period home, but they aren't prepared to compromise on space, quality or location. We think there is a real opportunity to capture that hyper local market. A site like this rarely comes to market.”

<img alt="Lowe " data-entity-type="file" data-entity-uuid="875fe572-0f14-4d90-9e11-55b28dd07731" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.42.49%E2%80%AFAM.png?VersionId=GDNQRv9BfpR9r1zkZ5UDyUM4ZvpIksut" />

The low-density proposal has been designed by Cera Stribley and is being progressed through the Victorian Government's Great Design Fast Track pathway, having already secured eligibility from the Minister for Planning.

The Office of the Victorian Government Architect supported its eligibility after finding the proposal demonstrated consistency with the program's seven design principles, while the project's financial feasibility has also been independently confirmed by Invest Victoria.

The project is targeting the downsizer market, with the planning documents describing the homes as larger-format residences and noting the two penthouses could otherwise have been configured as four separate apartments.

<img alt="Lowe 2" data-entity-type="file" data-entity-uuid="60ab0987-2da6-4175-adac-315dcf6053c6" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.43.15%E2%80%AFAM.png?VersionId=bOCPH0B2MFwlmaRW.TTCF9TzyifgVoQI" />

The site has dual frontage to Erskine Street and Canterbury Place and currently comprises a collection of commercial buildings used as offices, including a former heritage bakehouse, a former stable, a later gabled addition and a central courtyard.

It sits within the Commercial 1 Zone and the Armstrong Street Commercial Precinct heritage overlay, with the existing property classified as a contributory heritage place.

Heritage has subsequently played a significant role in Cera Stribley's design.

The front section of the former bakehouse facing Erskine Street will be retained, including its return walls, street-facing hipped roof and chimneys, while the Erskine Street façade and part of the western return wall of the former stable will also be incorporated into the new development.

Levels four and five will be set back five metres from the retained stable façade, while bricks removed through demolition are proposed to be salvaged and reused within the new building where possible.

<img alt="Lowe 3" data-entity-type="file" data-entity-uuid="e97927a9-a2de-4a0f-83b6-65451238abfa" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.43.06%E2%80%AFAM.png?VersionId=VR44AChLrX9q1XPB9GvVQV.ALXXbe4gC" />

Rather than presenting as a single five-storey building to Erskine Street, Cera Stribley has broken the development into a series of distinct forms.

A three-storey infill element will sit between the retained bakehouse and stable façades, with the upper levels recessed behind the heritage fabric. Canterbury Place will similarly feature two three-storey podium forms, separated by a central pedestrian accessway, before the upper two levels step back from the street.

A pedestrian through-link will run through the centre of the project between Erskine Street and Canterbury Place, creating entrances from both sides of the site and introducing landscaping and communal areas through the ground plane.

Landscape architect Acre has designed planting across the ground level, private terraces and upper levels, including a feature canopy tree at level three and integrated planting and arbours across the level four terraces. Five existing Erskine Street trees are proposed to be retained.

Sustainability is also a significant component of the Great Design Fast Track application. The apartments are targeting an average eight-star NatHERS rating, with no residence below 6.5 stars, while the project has achieved a 75 per cent BESS score. Seven of the eight apartments are designed for cross-ventilation, with the remaining residence using mechanically assisted natural ventilation.

The plans also incorporate an 8kWp rooftop solar system, a 5,000-litre rainwater tank and infrastructure allowing future electric vehicle charging for every residence.

Lowe has a strong portfolio across Melbourne's blue-chip suburbs. They recently launched <a href="https://www.apartments.com.au/new-apartments/jardin-house-by-lowe-living-camberwell-335-camberwell-road-camberwell-vic-3124">Jardin House by Lowe Living</a> in Camberwell, their first development in the Stonnington LGA.

Lowe Living unveils Middle Park apartment development

Article summary

<ul data-end="888" data-start="289">
	<li data-end="442" data-section-id="8tsh6o" data-start="289">DVB Projects is preparing to launch its second Gold Coast apartment development, with demolition now underway at 137 Old Burleigh Road, Broadbeach.</li>
	<li data-end="573" data-section-id="1nyxl3e" data-start="443">The 34-level tower will comprise just 49 ultra-luxury residences, including half-floor, full-floor and penthouse apartments.</li>
	<li data-end="717" data-section-id="oiyimj" data-start="574">The launch follows strong demand at DVB's nearby Sea Glass project, which is more than 50 per cent sold and currently under construction.</li>
	<li data-end="888" data-section-id="epk9o9" data-start="718">The development adds to the transformation of Old Burleigh Road, with premium beachfront apartment projects continuing to reshape the tightly held Broadbeach strip.</li>
</ul>

<a href="https://www.apartments.com.au/developers/dvb-projects">DVB Projects</a> is preparing to launch its second Gold Coast apartment development, with demolition now underway on the Broadbeach site as the Sydney developer moves closer to bringing the ultra-luxury project to market.

The 34-level tower at <a href="https://www.apartments.com.au/new-apartments/137-old-burleigh-road-broadbeach-qld-4218">137 Old Burleigh Road</a> will comprise just 49 residences, ranging from half-floor apartments through to full-floor homes and a penthouse. The launch follows the strong sales performance of DVB's nearby Sea Glass development. More than half of the apartments at Sea Glass, on the other side of Broadbeach, have been snapped up, well ahead of its late 2027 completion

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="2944b4be-c84e-4b54-8dc1-c712e76704c0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/E02_Exterior_Street%20Level%20Entrance.jpg?VersionId=YoNig7pRdrE3HCue7sUj78LzJteeQf3H" />

The start of demolition at 137 Old Burleigh Road signals DVB Projects’ underlying confidence in the Gold Coast’s luxury beachside apartment sector.

“We see the Gold Coast as one of the most compelling lifestyle markets in Australia, particularly at the premium end where demand continues to deepen,” said Dean Brown, Managing Director of DVB.&nbsp;

“This project has been carefully designed to respond to that demand - delivering large-format residences with a level of quality, privacy and amenity that is still relatively rare in the apartment market on the beachside."

Brown says the site itself is "exceptional."

"Old Burleigh Road is one of the most tightly held beachfront strips, and opportunities to deliver a project of this scale and calibre in this location are extremely limited.”

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="398f377a-c037-455e-9250-0c5e0d84c35b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/I12_FF%20Balcony.jpg?VersionId=NwOiRWGMubR1c8wthuEfggklcja7al9." />

The project will comprise 40 half-floor residences of approximately 260 sqm, alongside eight full-floor residences spanning around 524 sqm.

A single penthouse will crown the building, featuring a private pool, barbecue area, indoor gym and dedicated entertaining spaces.

Residents will have access to a resort-style suite of amenities, including a 20-metre pool with daybeds, a gymnasium, hot and cold plunge pools, a sauna, and private residents’ lounge and dining facilities.

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="d1642bb0-9a66-4427-a022-dfc0988c6287" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/A02_Pool%20to%20View.jpg?VersionId=c0IXPyn_Gp_Kn3XCwzMrqIVkAdCEwVXP" />

Sales agent Todd Matheson, of <a href="https://www.apartments.com.au/project-marketer/pezet-matheson">Pezet Matheson</a>, which is marketing both 137 Old Burleigh Road and Sea Glass, said 137 Old Burleigh Road would address a clear gap in the market for genuine luxury products.

“There are very few opportunities on the Gold Coast where buyers can secure a residence of this size and quality in a new building,” Matheson said.

“What we’re seeing is a growing cohort of downsizers and interstate buyers who still want space - they’re not willing to compromise on living area, entertaining or finishes.

“This project has been designed with that buyer in mind. It offers the scale of a home, combined with the convenience and security of apartment living, in one of the coast’s most desirable positions.”

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="59aae0ca-5639-4320-8aca-d0bf60f48e43" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/E01_Exterior%20Hero.jpg?VersionId=DS8Zfy2WtgUEtdfe0TEUuf1W1GfcZq8S" />

Located on a 1,156 sqm site one block from the beachfront, the development will replace an ageing walk-up building and is expected to contribute to the ongoing transformation of the Old Burleigh Road strip into one of the Gold Coast’s most prestigious residential corridors.

With the development moving into the delivery phase, 137 Old Burleigh Road is slated to hit the market later this year.

[smartcode_project_cta:default project_id=145141]

DVB Projects to launch second Broadbeach apartment tower as demolition commences

<a data-end="327" data-is-only-node="" data-start="250" href="https://www.apartments.com.au/developers/norus-projects" rel="noopener" target="_new">Norus Developments</a> has lodged plans for a new apartment development in Clayton that would add further momentum to the suburb's emerging Green Street corridor.

Plans have been lodged for the consolidated site at <a href="https://www.apartments.com.au/new-apartments/1359-1365-centre-road-clayton-vic-3168">1359-1365 Centre Road</a>, where Norus is seeking approval for 218 apartments across a 12-storey apartment building designed by <a href="https://www.apartments.com.au/architects/life-architecture-and-urban-design">Life Architecture</a>.

The proposal sits within the Clayton Major Activity Centre at the threshold of the planned Green Street corridor, a landscaped pedestrian connection intended to improve links through the precinct towards Clayton Railway Station.

The development would replace the site's existing collection of low-scale residential and commercial buildings with a single consolidated building, introducing significantly greater housing density to this part of Centre Road.

A retail tenancy is proposed at ground level to activate the Centre Road frontage, accompanied by transparent street interfaces and landscaping intended to create a more pedestrian-focused edge to the development.

<img alt="First look: Norus Developments plans landscape-led apartment project for Clayton’s emerging Green Street" data-entity-type="file" data-entity-uuid="0a5a763a-d9e9-4253-af2f-88008de27ebf" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Clayton%20a.png?VersionId=S2WJJbat1XVkZwB9SnYtygirXgWHiklX" />

The building has been designed with stepped massing and upper-level setbacks to manage its transition towards surrounding residential properties. The planning report describes the approach as one that integrates the building into the landscape rather than treating landscaping as a secondary element.

"A strong landscape and public realm strategy underpins the proposal," Urbis states in the planning report.

"Public benefits include an affordable housing contribution, a new pocket park, generous landscaped setbacks, deep soil planting and integrated Water Sensitive Urban Design."

The report adds that these elements are intended to create "a permeable, pedestrian-focused ground plane that enhances walkability, supports urban cooling and reinforces the emerging Green Street character."

Biophilic and passive design principles extend through the residential levels, with planting, daylight, natural ventilation and views towards landscaped areas forming part of the amenity strategy.

Parking would be concentrated away from the public realm, with 145 car spaces proposed from the rear laneway rather than dominating the Centre Road frontage.

The proposal follows an extensive pre-application process with the City of Monash. Three formal meetings were held between the project team and Council from December 2025 to March 2026, with the scheme evolving through several concept iterations before the current design was lodged.

The project arrives as Clayton prepares for substantial change around its established activity centre and the wider Suburban Rail Loop precinct. Its position on Centre Road places the development within an existing concentration of shops, services and public transport, while the Green Street connection is intended to strengthen pedestrian access towards Clayton Railway Station.

First look: Norus plans landscape-led apartment project for Clayton’s emerging Green Street

<a href="https://www.apartments.com.au/developers/gardner-vaughan-group">Gardner Vaughan Group</a> has officially commenced construction on Bronze on Chevron, celebrating the sod turning of its first-ever Gold Coast development and marking a significant milestone in the company's continued expansion across South East Queensland.&nbsp;

Following the successful delivery of premium residential developments throughout Brisbane and the Sunshine Coast, <a href="https://www.apartments.com.au/new-apartments/bronze-on-chevron-8-mawarra-street-chevron-island-qld-4217">Bronze on Chevron</a> represents Gardner Vaughan Group's entry into the Gold Coast market. Bronze will deliver 119 one, two, three and four-bedroom apartments above two ground-level retail tenancies.

[smartcode_project:default project_id=107520 project_image_fid=367193]

The recent sod turning ceremony was attended by Deputy Mayor Mark Hammel, President of the Surfers Paradise Surf Life Saving Club, Cassandra Sedgman, project consultants, purchasers, project partners and invited guests to celebrate the commencement of construction.&nbsp;

Gardner Vaughan Group Chief Executive Officer Simon Betteridge said Bronze on Chevron represented an exciting new chapter for the business.&nbsp;

"We've spent almost four decades building homes that respond to the way people want to live, and we're excited to bring that experience to <a href="https://www.apartments.com.au/developments/chevron-island-qld-4217">Chevron Island</a>," Betteridge said.

"Bronze on Chevron is particularly significant because it marks Gardner Vaughan Group's first development on the Gold Coast following many successful projects across Brisbane and the Sunshine Coast."

[smartcode_project:default project_id=107520 project_image_fid=367183]

Betteridge said the ground breaking is a proud moment for the&nbsp;team and their purchasers, who can now see their future homes beginning to take shape.&nbsp;

"As both developer and builder, we're able to oversee every aspect of the project from design through to construction, ensuring the quality and attention to detail Gardner Vaughan Group has become renowned for."&nbsp;

Designed by acclaimed architectural practice <a href="https://www.apartments.com.au/architects/cottee-parker-architects">Cottee Parker</a>, Bronze on Chevron has been thoughtfully designed to complement Chevron Island's evolving streetscape while embracing its relaxed coastal lifestyle.

The development will offer generous residences with refined interiors, premium finishes and resort-style amenities, with completion anticipated in early 2029.&nbsp;

[smartcode_project_cta:default project_id=107520]

The development will offer generous residences with refined interiors, premium finishes and resort-style amenities, with completion anticipated in early 2029

Gardner Vaughan Group breaks ground on first Gold Coast development, Bronze on Chevron

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

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The performance of Australian residential mortgage-backed securities (RMBS) will weaken moderately in 2020, following some improvement in Q3 2019, but delinquencies will remain low overall, according to a new report from Moody's Investors Service.
Their report found tat Australia's muted economic environment, record levels of household debt and the conversion of interest-only mortgages into principal and interest loans will lead to a moderate increase in RMBS delinquency rates in 2020. However, mortgage borrowers are seeing some relief in the form of low interest rates and rising house prices, which should constrain the degree of deterioration.
The 30+ day delinquency rate for prime Australian RMBS decreased to 1.57% in September 2019 from 1.67% in June 2019.
Moody's has lowered its growth forecast for the Australian economy over recent months and now expects real GDP growth of 2.2% for 2020, down from an earlier forecast of 2.5%.
The forecast for 2020 is higher than the 2.0% recorded in 2019, but down considerably from 2.7% in 2018.
Alena Chen, Vice President, Moody’s said, in this economic environment, expect mortgage delinquencies to increase moderately, particularly given that high household debt - which amounts to almost 200% of annual gross disposable income - will leave households vulnerable to economic and housing market shocks."
"However, we expect most mortgage borrowers will be able to continue meeting mortgage repayments at Moody's forecast level of economic growth and unemployment, which means delinquencies will remain low overall," she stated.
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j.ballantyne1990-6AQqhLzZaK

Australian RMBS will weaken moderately in 2020: Moody’s Investors Service

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The average mortgage holder is $127 a month better off after three rate cuts since June, research from RateCity.com.au has found.
The figures are based on a big four customer with a discounted variable rate and a $400,000 loan with 25 years remaining.
If the borrower chose to invest the savings back in to their mortgage by leaving their repayments the same, they would be over $24,000 ahead over the remainder of the mortgage, which would be paid off two years and three months sooner.
Sally Tindall, RateCity research director said, despite no rate cut yesterday, variable mortgage holders have come out in front this year.
“Home owners are very much ahead this year – our research shows that the average Australian mortgage holder is now saving an estimated $127 a month thanks to the three RBA cuts this year, even though they weren’t passed on in full,” she said.
Impact of three rate cuts in 2019 – average mortgage holder
<table border="0" cellspacing="0" cellpadding="0"><tbody>
<tr>
<td valign="bottom" nowrap width="321">
Estimated savings June to December
</td>
<td nowrap width="109">
$595
</td>
</tr>
<tr>
<td nowrap width="321">
RBA cumulative cuts since June
</td>
<td nowrap width="109">
0.75%
</td>
</tr>
<tr>
<td nowrap width="321">
Average cumulative cuts from big four banks
</td>
<td nowrap width="109">
0.57%
</td>
</tr>
</tbody></table>
“While it’s tempting to spend your money at the shops, putting the money into your mortgage could help you pay it off months, even years earlier.
“Our research also shows while the average owner-occupier rate has dropped 0.57 per cent in the last year, the lowest rate has dropped by 0.75 per cent. 
“If you’re willing to shop around there are rock bottom rates available,” she said. 
 
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jrobinson-rf4aSBido9

Average mortgage holder $127 a month better off after 2019 cuts

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EXPERT OBSERVER
What has changed since the last meeting?
The CoreLogic national home price index rose by 1.7% in November – the biggest rise in 16 years.
Wages rose 0.5% in the September quarter to be up 2.2% on the year.
Building approvals fell by 8.1% in October.
Business confidence and conditions rose in October.
Job ads fell by 1.7% in November. 
Private sector credit annual growth fell from 2.7% to a 9½-year low of 2.5% in October.
Employment fell by 19,000 in October – the first fall in 17 months.
The jobless rate rose from 5.2% to 5.3%.
In the twelve months to October 2019, the Budget deficit stood at just $78 million.
New business investment (spending on buildings and equipment) fell by 0.2% in the September quarter to be down by 1.3% over the year.
The rolling annual trade surplus was a record $63.35 billion in the year to September.
The Australian dollar has generally held around US66-69 cents.
The US and China are still reportedly progressing on a ‘Phase 1’ trade deal.
US and Australian share markets hit record highs in November.
The Reserve Bank Governor spoke on ‘unconventional monetary policies’.
The assessment
The Reserve Bank emphasises that rate cuts are indeed working. “The lower cash rate has put downward pressure on the exchange rate, which is supporting activity across a range of industries. It has also boosted asset prices, which in time should lead to increased spending, including on residential construction. Lower mortgage rates are also boosting aggregate household disposable income, which, in time, will boost household spending.”
The Reserve Bank has left the cash rate at 0.75% after cutting rates in June, July and October, each by 25 basis points. There have now been 15 rate cuts since November 2011 with the cash rate cut from 4.75%.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/12/3/Rate%20Cuts%20Lower%20AUD%20CommSec.jpg" alt="">
Previously rates rose seven times from October 2009 to November 2010 from 3.00% to 4.75%.
Interest rates are set to stay low for an extended period. The latest monthly reading suggests that inflation remains stuck near 1.5% – well below the Reserve Bank’s 2-3% target zone.
Rates could still go lower but the Reserve Bank seems prepared to play the waiting game. The Reserve Bank has emphasised that the rate cuts are indeed working, suggesting it may allow more time before deciding the next rate move. While rate cuts have caused confidence to weaken, the RBA is asking people to focus on the positives of lower rates like higher home prices and a lower Aussie dollar.
The Commonwealth Bank Group has pencilled in another rate cut in February. But fiscal policy stimulus is preferred. The mid-year budget review is handed down later in December.
The statement from the previous November 2019 meeting is on the left; the statement from today’s December 2019 meeting is on the right. Emphasis has been added to highlight key points in the wording in the statements.
The Reserve Bank emphasises that rate cuts are indeed working. “The lower cash rate has put downward pressure on the exchange rate, which is supporting activity across a range of industries. It has also boosted asset prices, which in time should lead to increased spending, including on residential construction. Lower mortgage rates are also boosting aggregate household disposable income, which, in time, will boost household spending.”
Perspectives on interest rates
The Reserve Bank has left the cash rate at 0.75% after cutting rates in June, July and October, each by 25 basis points. There have now been 15 rate cuts since November 2011 with the cash rate cut from 4.75%.
Previously rates rose seven times from October 2009 to November 2010 from 3.00% to 4.75%.
What are the implications of today’s decision?
Interest rates are set to stay low for an extended period. The latest monthly reading suggests that inflation remains stuck near 1.5% – well below the Reserve Bank’s 2-3% target zone. 
Rates could still go lower but the Reserve Bank seems prepared to play the waiting game. The Reserve Bank has emphasised that the rate cuts are indeed working, suggesting it may allow more time before deciding the next rate move. While rate cuts have caused confidence to weaken, the RBA is asking people to focus on the positives of lower rates like higher home prices and a lower Aussie dollar.
The Commonwealth Bank Group has pencilled in another rate cut in February. But fiscal policy stimulus is preferred. The mid-year budget review is handed down later in December.
Craig James is the chief economist at CommSec.
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cjames-5S2v74qSNK

Reserve Bank believes its rate cuts are working: CommSec's Craig James

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The Reserve Bank of Australia have kept the official cash rate at 0.75 per cent at its December meeting today.
The outlook for the global economy remains reasonable. While the risks are still tilted to the downside, some of these risks have lessened recently. The US–China trade and technology disputes continue to affect international trade flows and investment as businesses scale back spending plans because of the uncertainty. At the same time, in most advanced economies unemployment rates are low and wages growth has picked up, although inflation remains low. In China, the authorities have taken steps to support the economy while continuing to address risks in the financial system.
Interest rates are very low around the world and a number of central banks have eased monetary policy over recent months in response to the downside risks and subdued inflation. Expectations of further monetary easing have generally been scaled back. Financial market sentiment has continued to improve and long-term government bond yields are around record lows in many countries, including Australia. Borrowing rates for both businesses and households are at historically low levels. The Australian dollar is at the lower end of its range over recent times.
After a soft patch in the second half of last year, the Australian economy appears to have reached a gentle turning point. The central scenario is for growth to pick up gradually to around 3 per cent in 2021. The low level of interest rates, recent tax cuts, ongoing spending on infrastructure, the upswing in housing prices and a brighter outlook for the resources sector should all support growth. The main domestic uncertainty continues to be the outlook for consumption, with the sustained period of only modest increases in household disposable income continuing to weigh on consumer spending. Other sources of uncertainty include the effects of the drought and the evolution of the housing construction cycle.
The unemployment rate has been steady at around 5¼ per cent over recent months. It is expected to remain around this level for some time, before gradually declining to a little below 5 per cent in 2021. Wages growth is subdued and is expected to remain at around its current rate for some time yet. A further gradual lift in wages growth would be a welcome development and is needed for inflation to be sustainably within the 2–3 per cent target range. Taken together, recent outcomes suggest that the Australian economy can sustain lower rates of unemployment and underemployment.
Inflation is expected to pick up, but to do so only gradually. In both headline and underlying terms, inflation is expected to be close to 2 per cent in 2020 and 2021.
<div>
<div class="rss-mr-content">
There are further signs of a turnaround in established housing markets. This is especially so in Sydney and Melbourne, but prices in some other markets have also increased recently. In contrast, new dwelling activity is still declining and growth in housing credit remains low. Demand for credit by investors is subdued and credit conditions, especially for small and medium-sized businesses, remain tight. Mortgage rates are at record lows and there is strong competition for borrowers of high credit quality.
The easing of monetary policy this year is supporting employment and income growth in Australia and a return of inflation to the medium-term target range. The lower cash rate has put downward pressure on the exchange rate, which is supporting activity across a range of industries. It has also boosted asset prices, which in time should lead to increased spending, including on residential construction. Lower mortgage rates are also boosting aggregate household disposable income, which, in time, will boost household spending.
Given these effects of lower interest rates and the long and variable lags in the transmission of monetary policy, the Board decided to hold the cash rate steady at this meeting while it continues to monitor developments, including in the labour market. The Board also agreed that due to both global and domestic factors, it was reasonable to expect that an extended period of low interest rates will be required in Australia to reach full employment and achieve the inflation target. The Board is prepared to ease monetary policy further if needed to support sustainable growth in the economy, full employment and the achievement of the inflation target over time.
The statement was released by <a href="https://www.rba.gov.au/media-releases/2019/mr-19-33" target="_blank">the RBA</a>.
</div>
</div>
<div class="box-enquiries"> </div>
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Further signs of property market market turnaround: RBA Governor Philip Lowe's December meeting statement

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The Reserve Bank of Australia have kept the official cash rate at a record low 0.75 per cent at its December meeting today.
"There are further signs of a turnaround in established housing markets," Lowe said.
"This is especially so in Sydney and Melbourne, but prices in some other markets have also increased recently.
The RBA are waiting to see if their three cuts in 2019 will stimulate the local economy enough that a further cut isn't required.
NAB however are forecasting disappointing GDP growth of 0.3 per cent in Q3, slowing marginally from the growth rates seen in the last two quarters and a continuation of the weakness seen over the past year.
"NAB's expectation is that the RBA will ease rates by a further 25bp in February, with the risk that it will ease a further 0.25 per cent an announce unconventional policy should a material fiscal stimulus fail to materialise,", NAB advise. 
Two-thirds of Finder RBA's Cash Rate Survey, a survey of economists and experts, also predict a cut to 0.5 per cent in February.
Julie Toth of the Australian Industry Group said in the absence of tax reform, cuts are one of the only moves the RBA can make.
"Australia's economy is failing to accelerate (again) in 2019-20", Toth said.
“Non-mining business investment remains especially weak, but it is sorely needed to boost our productivity growth and real incomes for all.
“In the absence of meaningful tax reform and micro-economic reform, another rate cut probably won't help much, but it is the only response that the RBA can offer," Toth added.
Westpac's Bill Evans says the RBA <a href="/expert-insights/finance/rba-will-cut-cash-rate-to-0-25-by-june-2020-bill-evans">will cut rates to 0.25 per cent</a> by June 2020.
 
 
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RBA holds rates at December meeting

<html><body>
EXPERT OBSERVER
In a recent monthly credit update we wrote "Credit weakness lingers despite lift in housing finance".
A couple of months on, total credit growth slipped in October and annual growth hit a fresh cycle low.
Housing finance is rising and housing credit growth is beginning to stir - but only gradually.
However, business credit dipped in October, -0.1, against a challenging economic backdrop, and personal credit is contracting as households shift to other products.
In October, total credit grew by only 0.1%, which is below the monthly average for the 2019 year to date of 0.2%. The mix was: housing +0.27%; business -0.1%; and personal -0.6%.
Annual credit growth moderated to 2.5%, the slowest pace since April 2010.
Credit growth has progressively eased after peaking at 6.7% during the 2015/16 financial year. Key to the slowdown is the housing downturn as the cycle matured and lending conditions tightened.
Housing credit grew by 3.0% over the past year. That is the weakest result in the history of the series (dating back to the late 1970s) and below the previous cyclical low of 4.4% in mid-2013.
In 2018, the housing sector downturn accelerated as lending conditions tightened further and as investors pulled-back. New lending contracted by 5% in the six months to June and then fell by a sharp 15.4% in the six months to December (as weakness spread from investors to owner-occupiers).
Now in 2019, new lending for housing has turned the corner - with a 15% rebound from June to September, more than reversing the near 6% fall over the initial five months of the year.
The housing rebound has been supported by a number of factors. Sentiment bounced after the May Federal election, which removed uncertainty around tax policy for the sector. The RBA has lowered rates since June by a total of 75bps, with further cuts likely. In addition, APRA has eased mortgage serviceability assessments.
Housing credit is improving but slowing - with growth in October of 0.27%mth, 3.0%yr. The October figure annualised is 3.3%, up from a 3 month annualised low of 2.6%. Investor credit remains weak, with a broadly flat October month to be 0.2% lower over the year. For owner-occupiers, the figures are 0.44%mth, 4.8%yr.
Business credit growth slowed to 2.7% in October, including a decline in the month, of -0.1%.
The business credit profile has been uneven in 2019. There was a soft spot in the June quarter, around the time of the Federal election, (with growth at only 0.8% annualised), followed by a rebound in the September quarter (up by 3.4% annualised).
For businesses, the economic backdrop has become more challenging. The global economy is slowing and household spending is soft. In this environment business investment in the real economy has lost momentum across the non-mining sectors - which will weigh on credit demand.
Read full report: <a href="https://westpaciq.westpac.com.au/wibiqauthoring/_uploads/file/Australia/2019/November/er20191129BullCreditOct.pdf" target="_blank">Australian private credit October' (PDF 193 kb)</a>
ANDREW HANLAN is a senior economist for Westpac
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Housing finance and credit growth are beginning to stir: Andrew Hanlan

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EXPERT OBSERVER
Westpac now expects two rate cuts next year from the RBA with the cash rate cut to 0.25% in June 2020. Quantitative Easing is also expected to begin in the second half of 2020.
Westpac has not changed its rate call for the RBA since July 24 this year. At that time we envisaged two more cuts from the RBA in October 2019 and in February 2020. That would have seen the terminal cash rate in this cycle at 0.5%.
We expected that the final cut in February would have been insufficient to provide the RBA with enough comfort that the economy was moving into line with their growth; inflation; and unemployment targets.
Consequently, we expected that the RBA would have seen the need for unconventional policies, largely centred around the purchase of Australian government securities and clear forward guidance, to maintain the emphasis that it was still easing policy.
That emphasis was going to be important to maintain downward pressure on the Australian dollar, in particular.
Of course there was always the option to push the cash rate even lower than 0.5% but we assessed that the RBA would see the impact on confidence and inflationary expectations of even lower rates to be counter-productive.
The minutes of the November RBA Board meeting provided some support to our view when it was noted the Board “also discussed the possibility that a further reduction in interest rates could have a different effect on confidence than in the past, when interest rates were at higher levels”.
That observation was certainly consistent with the 5.5% fall in the Westpac MI Consumer Sentiment Index following the announcement of the rate cut in October. Concerns around the implications of ultra- low rates for the state of the economy along with negative publicity around the limited impact of rate cuts on private sector rates are likely to have largely explained that development.
Indeed, since the RBA started this current easing cycle, the Index has fallen by 4.2% to now be firmly in the range where pessimists outnumber optimists.
However in a speech to the Australian Business Economists last night the Governor stated, “Our current thinking is that QE becomes an option to be considered at a cash rate of 0.25%, but not before that.” During the presentation he noted that 0.25% represents the Effective Lower Bound of the cash rate as the interest rate paid on reserves at the RBA is 25bp under the prevailing cash rate and therefore would mean the “Reserve Bank would already be at zero”.
Read full report <a href="https://westpaciq.westpac.com.au/wibiqauthoring/_uploads/file/Australia/2019/November/er20191127BullRBACutCashRate.pdf">'RBA cut cash rate' (PDF 91kb)</a>
<div>
BILL EVANS is the Chief Economist for Westpac
</div>
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bevans-rYk9SxEa4r

RBA will cut cash rate to 0.25% by June 2020: Bill Evans

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Australia's official interest rate isn't likely to go below zero, according to RBA Governor Philip Lowe.
At the Business Economics Dinner in Sydney last night, Lowe said negative rates are "extraordinarily unlikely."
A method used in Europe and Japan, Lowe said the tool is truly unconventional.
"Prior to the financial crisis, it was widely thought that zero was the lower bound for the policy interest rate.
"It was thought that if interest rates went below zero, people would hold their savings in banknotes rather than be charged by their bank to deposit their money.
Lowe said that having examined the international evident, it is not clear that negative interest rates has been a success.
"While negative rates have put downward pressure on exchange rates and long-term bond yields, they have come with other effects too.
"It has become increasingly apparent that negative rates create strains in parts of the banking system that can impair the ability of some banks to provide credit.
"Negative interest rates also create problems for pension funds that need to fund long-term liabilities.
"In addition, there is evidence that they can encourage households to save more and spend less, especially when people are concerned about the possibility of lower income in retirement.
"A move to negative interest rates can also damage confidence in the general economic outlook and make people more cautious.
Policy interest rates have been negative in Denmark, Sweden and Switzerland. Rates have been lowest in Switzerland, at minus ¾ per cent.
The only country outside of Europe that has had negative policy interest rates is Japan, at minus 0.1 per cent.
Lowe said Australia is not in the same situation that has been faced in Europe and Japan.
"Our growth prospects are stronger, our banking system is in much better shape, our demographic profile is better and we have not had a period of deflation. So we are in a much stronger position."
Lowe said low interest rates are not a temporary phenomenon and are "likely to be with us for some time."
The full speech was <a href="https://www.rba.gov.au/speeches/2019/pdf/sp-gov-2019-11-26.pdf" target="_blank">first published here</a>.
 
 
 
 
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Negative interest rates in Australia extraordinarily unlikely: RBA Governor Philip Lowe

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The National Australia Bank has been announced as the first lender on the lending panel for the government’s first-home loan deposit scheme.
They have committed to not charging eligible customers higher interest rates after the housing stimulus package begins on January 1.
NAB chief customer officer Mike Baird said the bank would update eligible customers in the lead-up to January 1.
<div class="storysegment2 segmentContentFull">
Mr Baird said NAB was “proud” it had been selected to partner the government and described it as a “great endorsement” of the bank’s home loan offering.
“This scheme is a fantastic way of helping even more customers, allowing them to potentially save thousands of dollars on their mortgage,” Mr Baird told The Australian.
NAB has been offering special rates for first-home buyers, with a 2.88 per cent annual rate fixed for two years, since 2017.
</div>
The NHFIC will supervise the scheme, overseeing rules that permits only two major lenders to be appointed to the lending panel. The big bank will only be entitled to receive up to 50 per cent of the 10,000 guarantees allocated per financial year.
There will also be a range of non-major lenders appointed to the lending panel.
Loan applications for the scheme are not yet open.
Information about the Scheme is available on NHFIC’s website including an online tool to assist prospective first home buyers determine the relevant property price threshold that will apply to any potential purchases. 
Additional eligibility tools are being developed and will be launched publicly.
First-home buyers wanting to buy next year using the new home loan deposit scheme will be limited to properties sold for less than $700,000 in Sydney, $600,000 in Melbourne, $500,000 in Canberra and $475,000 in Brisbane.
There are regional limits too.
The scheme will apply to owner-occupied loans for FHBs with an annual income of up to $125,000 or couples with a combined $200,000 per year.
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NAB to offer competitive home loans for FHBs in government’s first-home loan deposit scheme

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EXPERT OBSERVATION
Demand for fixed rate home loans was stable in October, reveals data from Mortgage Choice.
According to the Company’s home loan approval data, demand for fixed rate home loans has stalled, accounting for 14% of all home loans written throughout the month of October, the same proportion as the month prior.
Our home loan data reveals that despite extremely competitive fixed-rate pricing, borrowers are reluctant to lock in a fixed rate. The level of demand for fixed rate home loans has not changed in four months and is significantly lower year on year. In fact, fixed rate loans accounted for a quarter of all home loan demand in October 2018.
In the current low-rate environment, we are seeing interest rates on fixed-rate home loans fall below 3% p.a., which makes it even more surprising to see fixed rate demand hover at levels not seen in eight years.
That being said, speculation is rife that the Reserve Bank of Australia will cut the cash rate a fourth time this cutting cycle, which would be reason enough to keep borrowers from locking in.
Demand for fixed rate loan products varied across the country. Borrowers in Victoria were the least likely to fix, with only 7% of borrowers locking in their rate, followed by Western Australia where 8% locked into a fixed rate product.
Meanwhile, borrowers in New South Wales were the most likely to choose a fixed interest rate home loan, with 18% choosing this loan, followed by borrowers in South Australia, where 17% chose to fix.
I suspect fixed rate demand is likely to remain at the same levels into the new year.
With such low interest rates on offer, now could be a great time to lock into a fixed rate home loan or make the decision to fix part of your home loan so can enjoy the best of both worlds. Ultimately, the answer to the fixed versus variable debate will come down to each borrower’s unique financial situation, needs and long-term goals.
My advice to borrowers who foresee a change to their income or face the possibility of budget constraints would be to speak to their mortgage broker. If you seek the comfort of knowing that you will have home loan repayment certainty, a fixed rate loan might be the right option for you.
That being said, if you want to take advantage of rate drops, a variable rate home loan might be a more suitable choice. We have seen variable rate home loan interest rates fall significantly off the back of three cash rate cuts from the Reserve Bank of Australia. If the RBA cuts the cash rate again, we could see variable rates drop even further.
Borrowers who are deciding whether to opt for a home loan with a variable, or a fixed interest rate would be well advised to speak to their local mortgage broker to discuss their options.
SUSAN MITCHELL is the Mortgage Choice Chief Executive Officer
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