Both Qudos Bank and Freedom Lend made adjustments to construction home loan rates in the past week in a possible bid to attract HomeBuilder grant recipients. 

The $25,000 HomeBuilder grant is available for people building a home up to the value of $750,000 including land value.

Qudos Bank's cuts were:

  • Construction Home Loan 80%: 50 basis point cut to 2.89% p.a. (2.93% p.a. comparison rate*)
  • Construction Home Loan 90%: 50 basis point cut to 2.99% p.a. (3.03% p.a. comparison rate*)

Qudos Bank also made cuts to its investment construction loans, but investment properties are not eligible for HomeBuilder.

Meanwhile, Freedom Lend made a smaller cut by 3 basis points to its construction loan, down to 2.68% p.a. (2.70% p.a. comparison rate*)

This rate is applicable for both 80% and 90% LVR borrowers, which is unusual given lenders usually charge a higher rate if borrowers have a smaller deposit.

Compared to others in the construction loan market, this is how these two lenders stack up:

Lender

VariableMore details
  • 10% deposit minimum
  • Up to 30 yrs loan term
  • Interest Only during construction

loans.com.au – Solar Construction 90

  • 10% deposit minimum
  • Up to 30 yrs loan term
  • Interest Only during construction
VariableMore details

Great Southern Bank – Basic Variable Owner Occupier Construction (LVR ≤ 70%)

    VariableMore details

    Qudos Bank – Construction Home Loan (LVR < 80%)

      VariableMore details

      Geelong Bank – HomeBuilders Loan (Interest Only) (LVR < 80%)

        VariableMore details
        • Interest-only during construction
        • No monthly or ongoing fees

        loans.com.au – Construction Home Loan (LVR < 90%)

        • Interest-only during construction
        • No monthly or ongoing fees
        VariableMore details

        La Trobe Financial – Construction Home Loan

          VariableMore details

          Gateway Bank – Construction Home Loan

            Important Information and Comparison Rate Warning

            Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of December 6, 2023. View disclaimer.

            The 2% barrier got breached again

            Earlier in the week, challenger brand loans.com.au introduced a home loan with a variable interest rate below the 2.00% p.a. barrier, down to 1.99% p.a. (2.55% p.a. comparison rate*).

            The sub-2% rate is available for the first year, before the rate then reverts to 2.57% p.a.

            The online lender also launched a two year discounted variable rate of 2.09% p.a.(2.71% p.a comparison rate*) which reverts to 2.79% p.a. after two years.

            Both products are limited to borrowers with a maximum LVR of 80%, with a maximum loan amount of $1 million. 

            This is how loans.com.au's 1.99% p.a. introductory home loan stacks up against other competitive variable-rate home loans on the market:

            Lender

            VariableMore details
            Online ExclusiveUp To $4K Cashback Includes NOV RBA Rate Increase
            • Immediate cashback upon settlement
            • $2000 for loans up to $700,000
            • $4000 for loans over $700,000
            Online ExclusiveUp To $4K Cashback Includes NOV RBA Rate Increase

            loans.com.au – Variable Basic Cashback Home Loan (Principal and Interest) (LVR < 70%)

            • Immediate cashback upon settlement
            • $2000 for loans up to $700,000
            • $4000 for loans over $700,000
            VariableMore details
            Refinance OnlyApply In Minutes
            • No application or ongoing fees. Annual rate discount
            • Unlimited redraws & additional repayments. LVR <80%
            • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
            Refinance OnlyApply In Minutes

            Unloan – Variable Rate Home Loan – Refinance Only

            • No application or ongoing fees. Annual rate discount
            • Unlimited redraws & additional repayments. LVR <80%
            • A low-rate variable home loan from a 100% online lender. Backed by the Commonwealth Bank.
            VariableMore details
            • Up is 100% owned by Bendigo Bank.
            • Up to 50 offset accounts
            • New joiners get $10 by signing up to the app using code UPHOMESAVINGS. (T&Cs apply)

            Up – Up Home Variable (Principal & Interest) (LVR ≤ 90)

            • Up is 100% owned by Bendigo Bank.
            • Up to 50 offset accounts
            • New joiners get $10 by signing up to the app using code UPHOMESAVINGS. (T&Cs apply)
            Important Information and Comparison Rate Warning

            Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to be made on variables as selected and input by the user. Some products will be marked as promoted, featured or sponsored and may appear prominently in the tables regardless of their attributes. All products will list the LVR with the product and rate which are clearly published on the product provider’s website. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. *The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. Rates correct as of December 6, 2023. View disclaimer.

            At the end of June, Bank of Us also breached the 2.00% barrier with 1.99% fixed rates across a suite of fixed-rate terms, although these are only available for Tasmanian residents.

            Hobart was one of the only capital cities to record a home price growth in the June quarter, according to a Domain report, and had the second-strongest home price growth at 10% on the year, with Sydney in first.

            Community First and Horizon Bank continue customer-owned cutting trend

            In continuing the trend of customer-owned institutions cutting home loan rates, on Monday Community First virtually scrubbed the fixed home loan deck, making a wide variety of cuts by 20 basis points.

            Some of its freshly cut rates include:

            • Fixed P&I 3 Years: Down to 2.49% p.a. (3.56% p.a. comparison rate*)
            • Accelerator Package Fixed P&I 3 Years: Down to 2.34% p.a. (3.80% p.a. comparison rate*)
            • Investment Fixed P&I 3 Years: Down to 2.79% p.a. (3.86% p.a. comparison rate*)
            • Inv Accelerator Package Fixed 3 Years: Down to 2.64% p.a. (4.09% p.a. comparison rate*)

            Yesterday, Horizon Bank cut a few fixed rates for investors and owner-occupiers by 30 basis points. The new rates are:

            • Fixed 1 Year: Down to 2.69% p.a. (3.45% p.a. comparison rate*)
            • Fixed 2 Years: Down to 2.69% p.a. (3.38% p.a. comparison rate*)
            • Inv Fixed 1 Year: Down to 2.94% p.a. (3.69% p.a. comparison rate*)
            • Inv Fixed 2 Years: Down to 2.94% p.a. (3.63% p.a. comparison rate*)

            CommBank has reported a spike in fixed rate lending in recent months, with around 40% of all new owner-occupier loans at fixed rates.





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