Two of Australia’s big four banks – Westpac and NAB – have lifted their home loan rates for investors as we head towards Christmas.
Before Santa comes rumbling down our chimneys, NAB is increasing its variable rates on new and existing residential investor home loans from 5.4 per cent to 5.55 per cent, while keeping their owner-occupier variable home loan rate steady at 5.25 per cent.
Westpac are bumping up their investor home loan variable rate by 8 basis points to 5.68 per cent. Westpac are also bumping their owner-occupier variable rates by 8 basis points, to have it sitting at 5.41 per cent.
NAB chief operating officer Antony Cahill explained the move in a statement.
“We don’t make these decisions lightly, and these changes reflect the increasingly challenging environment we are currently operating in as we seek to meet the needs of all our customers and our shareholders,” he said.
“As was evident during the recent bank reporting season, net interest margins – the difference between what we pay to borrow funds to lend to our customers and what our customers pay – are down, particularly in home lending, and they remain under pressure.”
“A low-rate environment poses considerable challenges to all lenders, and we must respond to what is happening in the economy and the market. In doing so, we have to consider a range of factors including the ongoing need to hold longer-term stable sources of funding, continued elevated funding costs, regulatory requirements, and the competitive pressures at play.”
Mr Cahill said NAB saw investors as an important sector and reminded customers that interest rates are at record lows, and customers should consider fixing part or all of their home loan.
“Switching to a fixed-rate loan is a straightforward and easy process, and I encourage borrowers to speak with their banker or broker to find out more about what’s available, and if a fixed rate home loan might be right for their circumstances,” he said.