Property investors should be wary
Tuesday, April 21, 2009
Fixed interest rates are on the rise at Westpac and the Commonwealth Bank but that does not mean property investors should rush to fix.
'When a bank makes an offer to you, nine times out of ten its in their best interest,' Robert Projeski, director of Australian Mortgage Options said.
'If you want certainty you pay for it.'
Westpac's interest rates on fixed home loans have been hiked by up to 40 basis points.
One-year fixed rate mortgages were increased by 20 basis points to 5.39 per cent, while two-year term mortgages rose 30 basis points to 5.49 per cent.
Three-year term mortgages lifted by 40 basis points to 5.79 per cent and five-year term mortgages increased by 10 basis points to 6.39 per cent.
The moves came after National Australia Bank raised interest rates on two and three-year fixed mortgages by 20 basis points on April 14.
CBA raised its interest rates on fixed rate mortgages by between 20 basis points and 45 basis points, but said one-year home loans will not be affected.
Rates on two-year fixed home loans currently stand at 5.29 per cent at NAB, 5.79 per cent at CBA and Westpac, and 5.99 per cent at ANZ.
Despite the added cost, fixed rates do offer some sense of security for some property investors.
'If it's a relatively new investor or if they are highly geared so-to-speak,' Mr Projeski said.
'So from a peace of mind point of view it makes sense for them to fix.'
Bigpond News
