The Westpac-Melbourne Institute Index of Consumer Sentiment increased by 2.6% to 111.8 in March from a month prior, well above the long-term average of 101.3. 

This is just 0.2 points below the ten-year high seen in December, and is up 21.6% from the index score recorded 12 months prior, when coronavirus restrictions first hit the economy. 

According to Westpac, driving this increase is Australia’s success in containing COVID-19, the impending vaccine rollout, and "improving economic conditions and prospects, both domestically and abroad". 


Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.

Update resultsUpdate
LenderHome LoanInterest Rate Comparison Rate* Monthly Repayment Repayment type Rate Type Offset Redraw Ongoing Fees Upfront Fees LVR Lump Sum Repayment Additional Repayments Split Loan Option TagsFeaturesLinkCompare
6.04% p.a.
6.06% p.a.
$2,408
Principal & Interest
Variable
$0
$530
90%
Featured 4.6 Star Customer Ratings
  • No monthly or ongoing fees
  • Unlimited free redraw
  • No application fee
5.99% p.a.
5.90% p.a.
$2,396
Principal & Interest
Variable
$0
$0
80%
Featured Apply 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.
6.09% p.a.
6.11% p.a.
$2,421
Principal & Interest
Variable
$0
$250
60%
Featured Unlimited Redraws
  • No annual fees - None!
  • Get fast pre-approval
  • Unlimited additional repayments free of charge
  • Redraw freely - Access your additional payments when you need them
  • Home loan specialists available today
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 . View disclaimer.

Consumers generally remain confident in their ability to spend and save: 

  • 'Family finances vs a year ago' is up 10.4% yearly
  • 'Family finances next 12mths' is up more than 14% yearly 
  • 'Economic conditions next 12mths' is up 3.7% monthly and almost 50% yearly 
  • 'Time to buy a major household item' rose 3.7% and 11% monthly and yearly respectively 

WPCCCI

However, house price expectations continue to rise, increasing more than 3% on the month as February recorded the largest monthly price rise in 17-years, according to CoreLogic. 

With the 'Time to buy a dwelling' index falling 3.6% monthly, Westpac's chief economist Bill Evans said the survey shows "evidence of tensions emerging in the housing market", something similar to what it said last month

"The tensions in the housing market are likely to be evidence of an emerging squeeze on affordability from rising prices," Mr Evans said. 

"While optimism around house prices is surging, respondents are becoming more hesitant around the attractiveness of buying and remain wary about real estate as an investment option.

"The decline suggests resurgent prices are already starting to curb buyer interest and that we may see some easing in the recent surge in demand from owner occupiers, particularly from first home buyers who are the most sensitive to affordability."

See also: RBA watching housing market boom 'carefully', may intervene

"Safe" investment options still dominating 

Despite confidence increasing, Aussies still appear to be taking a conservative approach with their cash, keeping it stashed in their bank accounts instead of investing it. 

With more than $200 billion added to deposit accounts last year, the survey found 30% of consumers nominated deposits as the safest place for savings, similar to the 30.3% seen in the GFC

'Pay down debt' was nominated by 18% of respondents (20.3% GFC), while just 9.3% of consumers nominated ‘real estate’, the third lowest result in 47 years.

Shares were chosen by around 10%. 

Need somewhere to store cash and earn interest? The table below features savings accounts with some of the highest non-introductory and introductory interest rates on the market.

Update resultsUpdate
BankSavings AccountBase Interest Rate Max Interest Rate Total Interest Earned Introductory Term Minimum Amount Maximum Amount Minimum Monthly Deposit Minimum Opening Deposit ATM Access Joint Application TagsFeaturesLinkCompare
4.40% p.a.
5.75% p.a.
Intro rate for 4 months
then 4.40% p.a.
$980
4 months
$0
$250,000
$0
$0
Featured
  • Bonus rate for the first 4 months from account opening
  • No account keeping fees
  • No minimum balance
4.75% p.a.
5.35% p.a.
Intro rate for 4 months
then 4.75% p.a.
$1,001
4 months
$0
$249,999
$0
$0
Featured
  • A high-interest online savings account with no monthly fees, easy withdrawals and award-winning digital banking
  • No withdrawal notice periods or interest rate penalties
  • Save up to 10% on eGift cards at over 50 retailers with Macquarie Marketplace
Bonus rate of 5.50%
Conditions apply.
5.50% p.a.
$1,128
$0
$100,000
$0
$0
Featured *Rate varies on savings amount
  • Deposit $500 per month to get bonus interest
  • 5.50% p.a. available on total savings up to $100k.
  • 5.00% p.a. applies to savings between $100k-250K.
  • Tiered bonus rates apply. (TMDs at ubank.com.au)
0.55% p.a.
Bonus rate of 4.95%
Conditions apply.
5.50% p.a.
$1,128
$0
$100,000
$1,000
$0
  • Deposit at least $1,000+ each month from an external source
  • Make 5 or more eligible transactions
  • Grow your savings balance each month
Bonus rate of 3.25%
Conditions apply.
5.25% p.a.
Intro rate for 4 months
then 3.25% p.a.
$790
4 months
$0
$1,000,000
$50
$1
  • Earn up to 5.25% p.a. interest on balances up to $1M. T&Cs apply.
0.50% p.a.
Bonus rate of 4.85%
Conditions apply.
5.35% p.a.
$1,097
$1
$50,000
$500
$1
0.05% p.a.
Bonus rate of 4.95%
Conditions apply.
5.00% p.a.
$1,023
$1
$250,000
$20
$0
0.05% p.a.
Bonus rate of 5.45%
Conditions apply.
5.50% p.a.
$1,128
$0
$50,000
$1,000
$0
For customers aged 14-35 years
0.05% p.a.
Bonus rate of 5.30%
Conditions apply.
5.35% p.a.
$1,097
$0
$250,000
$1,000
$0
Important Information and Comparison Rate Warning

All products with a link to a product provider’s website have a commercial marketing relationship between us and these providers. These products may appear prominently and first within the search tables regardless of their attributes and may include products marked as promoted, featured or sponsored. The link to a product provider’s website will allow you to get more information or apply for the product. By de-selecting “Show online partners only” additional non-commercialised products may be displayed and re-sorted at the top of the table. For more information on how we’ve selected these “Sponsored”, “Featured” and “Promoted” products, the products we compare, how we make money, and other important information about our service, please click here. Rates correct as of . View disclaimer.

Mr Evans said the Reserve Bank board will be pleased with Australia's economic progress, but remain unlikely to make any changes to interest rates in the near future.

"Enthusiasm for spending and comfort with job prospects and security will be reassuring to the Board. But markets and some commentators have been warning against damaging housing bubbles," he said.

"The survey points to rising house prices although investors still appear cautious. Owner occupiers, including first home buyers, may already be becoming deterred by the associated deterioration in affordability.

"We can be confident that if the [Reserve] Bank does become concerned about over-heating the likely policy response will be to impose regulations on bank lending rather than to increase interest rates."

ANZ also reports high consumer confidence 

The ANZ-Roy Morgan Consumer Confidence increased by 1.6 points to 111.9 this week, which is now above the 2021 weekly average of 110.4 and  a significant 11.5 points higher than the same week in 2020. 

According to Roy Morgan, this was driven by "increasing confidence about the performance of the Australian economy over the next year and next five years". 

ANZCC

This index shows 39% of Australians expect their family to be ‘better off’ financially this time next year, while 41% say now is a ‘good time to buy’ major household items.

ANZ Head of Australian Economics David Plank said these numbers reflect the strong gains registered by ANZ Job Ads and the GDP numbers last week

Photo by Blake Weyland on Unsplash   





Ready, Set, Buy!


Learn everything you need to know about buying property – from choosing the right property and home loan, to the purchasing process, tips to save money and more!

With bonus Q&A sheet and Crossword!

By subscribing you agree to our privacy policy