Macquarie reveals big home loan rate cuts

The new lowest owner occupier home loan rate available at Macquarie is now 5.19% p.a. (5.78% p.a. comparison rate*) for two years fixed with up to 70% LVR.

That's the lowest rate on our database, topping yesterday's rate cuts from Regional Australia Bank which dropped two year fixed rates to 5.25% p.a. (5.62% p.a. comparison rate) for borrowers with an LVR below 60%.

Fixed rates have been going down since well before the February cash rate cut, beginning after the sudden drop in bond yields that happened mid last year, but the decline has accelerated with growing expectations the RBA will cut again, by 25 bps at least, in May.

The likelihood of further rate cuts in the near future will likely prompt many borrowers to choose not to fix, although for now the fixed rates on market are generally significantly lower than variable ones, with a couple of rate cuts already priced in. 

Should the RBA cut by 25 bps in May, the advertised rate on the lowest variable rate on our database - 5.49% p.a. (5.69% p.a. comparison rate*) First Option Bank Discounted Simple Home Loan for LVR up to 60% -will remain higher than this new rate from Macquarie even if the cut is passed on in full.

If the cut is 0.50% though, as 62% of traders are expecting, these fixed rates may quickly start to look much less attractive - as ever, much will depend on the outcome of the upcoming monetary policy meeting.

The March quarter CPI data (set for release on 30 April) is likely to be pivotal, as of course is the current market turmoil in Australia and overseas, although Michele Bullock recently suggested the RBA may be unlikely to hit the panic button.

"We're not currently seeing the same degree of impact as [in] previous market events like in 2008 for example," the RBA governor said in a speech at the Chief Executive Women dinner in Melbourne earlier this month.

"The Australian financial system is strong and well placed to absorb shocks from abroad."

For now, here were the major movements in the home loan market in the working week ending 24 April:

Macquarie cuts fixed rates by up to 20 bps

These are the new P&I rates for owner occupiers:

And for investors:

Read more: Macquarie Bank home loans

Regional Australia Bank cuts by up to 36 bps

Regional Australia Bank's Wednesday cuts saw it briefly offer the lowest fixed rate on market (5.25% p.a., 5.66% p.a. comparison rate for two year fixed terms up to 60% LVR).

Rates were slashed across the board for both investors and owner occupiers, and while Macquarie's new rates are slightly lower, Regional Australia Bank still has the lowest rates among customer owned banks.

As it stands, Macquarie Bank also isn't among the participating lenders on the Home Guarantee Scheme, so if you're a first home buyer looking to take advantage, Regional Australia Bank has the lowest rates available to you.

Read more: Regional Australia Bank new home loan rates

Other movers

• AMP cut fixed rates for both owner occupiers and investors by up to 30 bps. Its new lowest fixed rate for owner occupiers is 5.35% p.a. (6.76% p.a. comparison rate*) on three year fixed terms. That applies to borrowers with an LVR below 80% on AMP's Professional Package, which has a $349 annual fee, but allows up to 10 offset accounts.
• Firstmac hiked variable rates on its Green and Solar loans by 10 bps.
• Bank Australia, Aussie, Hume Bank and Summerland Bank all also cut fixed rates, with Summerland dropping select variable rates as well

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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.

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Lender	Home Loan	Interest Rate	Comparison Rate*	Monthly Repayment	Repayment type	Rate Type	Offset	Redraw	Ongoing Fees	Upfront Fees	Max LVR	Lump Sum Repayment	Extra Repayments	Split Loan Option	Tags	Features	Link	Compare	Promoted Product	Disclosure
loans.com.au	loans.com.au Bare Home Loan (Basic OO P&I <90%)	5.94% p.a.	5.98% p.a.	$2,978	Principal & Interest	Variable			$0	$530	90%				Owner Occupier Variable Principal & Interest 10% Min Deposit Redraw Extra Repayments More details	Available for purchase or refinance, min 10% deposit needed to qualify. No application, ongoing monthly or annual fees. Dedicated loan specialist throughout the loan application.	Go to site	Compare	Promoted	Disclosure
Unloan	Unloan Variable Rate Home Loan LVR < 80%	5.89% p.a.	5.80% p.a.	$2,962	Principal & Interest	Variable			$0	$0	80%				Built and funded by CommBank Owner Occupier Variable Principal & Interest 20% Min Deposit Redraw More details	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.	Go to site	Compare	Promoted	Disclosure
Regional Australia Bank	Regional Australia Bank Home Loan Fixed (Owner Occupier, Principal and Interest, max lvr 60%) (3 years)	5.99% p.a.	6.02% p.a.	$2,995	Principal & Interest	Fixed			$0	$0	60%				Owner Occupier Fixed 3 Years Principal & Interest 40% Min Deposit Redraw More details	Competitive rates to help you save A Dedicated Relationship Manager Certainty of repayments with a fixed rate term	Go to site	Compare	Promoted	Disclosure
Homestar	Homestar Star Nova LVR <70% (Owner Occupied, Principal and Interest)	5.93% p.a.	5.93% p.a.	$2,975	Principal & Interest	Variable			$0	$395	70%				Owner Occupier Variable Principal & Interest 30% Min Deposit Redraw More details		Go to site	Compare		Disclosure
Reduce Home Loans	Reduce Home Loans EconoME Home Loan (Owner Occupier, Principal & Interest, LVR 60%)	5.99% p.a.	6.01% p.a.	$2,995	Principal & Interest	Variable			$0	$150	60%				$3000 Cashback T&Cs apply Owner Occupier Variable Principal & Interest 40% Min Deposit Redraw More details		Go to site	Compare		Disclosure

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