Fixed rate popularity stalls
Demand for fixed rate mortgages stalled in January, new research has found.
While popularity of fixed rate home loans remains higher than the last couple of years, data from Mortgage Choice found demand barley rose as 2011 began.
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15.3 per cent of all the home loans approved for Mortgage Choice customers in January had a fixed interest rate. This compared to 15.2 per cent in December, 11.2 per cent in November, 7.7 per cent in October and 3.7 per cent in September.
“One has to question whether the demand for this more conservative loan type has steadied now it looks likely that the next cash rate rise has been pushed back to mid-year or later,” Mortgage Choice spokesperson Kristy Sheppard said.
“Of all the mortgage types, ongoing discount loans - where the interest rate is discounted over the entire loan term usually in return for an annual fee - experienced the biggest increase in demand. They accounted for 25.3 percent of our January approvals, having risen 8.4 percentage points in the last two months.”
