Surge in fixed home loan uptakes during December
Everyone knows how important it is to secure the right type of home loan when you're looking into buying a property, especially if you're hoping to have a seamless and enjoyable repayment period.
There are a large number of factors to be aware of when it comes to finding the right home loan, which can be confusing without the help of a professional to guide you. However, looking towards statistics can help you to see trends and factor them into your decision.
For example, fixed rate home loans increased in popularity during December 2013, which could be a great signal about the direction of the market in the near future. The latest data from Mortgage Choice has indicated the degree of growth during the month.
Over December, fixed rate home loans accounted for 33.06 per cent of the mortgages sought. This is a fairly large increase from the month before, when fixed rate loans accounted for just 30.56 per cent nationwide.
Jessica Darnbrough, a spokesperson for Mortgage Choice, said fixed rate levels haven't been this high since March 2008, which could indicate a shifting mood in the real estate market.
"Borrowers are increasingly flocking to the safety of fixed rate home loans as they seek to provide themselves with certainty around their mortgage repayments," said Ms Darnbrough in a January 6 statement.
"In the current economic environment and with the Reserve Bank keeping its cards close to its chest, it is not surprising to see so many borrowers opting for the safety and security of a fixed rate home loan."
The popularity was fairly uniform across the whole of Australia, with the exception of New South Wales, which underwent a 0.58 per cent drop in demands for fixed rate home loans during the month. Queensland saw the largest increase, with the number of fixed rate loans increasing by 44 per cent.
This could be an interesting trend to consider before approaching the real estate market, especially with the first meeting of the Reserve Bank of Australia for 2014 expected to be held in February, where a decision about the official cash rate will be made.
However, there is plenty of demand for variable rates across the nation, which still proved to be popular among many buyers. This type of mortgage accounted for 66.94 per cent of home loans taken out during the December period.