Mortgage rate hikes continue to hit Australian homeowners

OWNER occupiers are continuing to be hit by rising interest rates, as more banks follow the big four and increase their costs to borrow.

Lenders continue to raise their interest rates on owner occupier loans outside of the traditional Reserve Bank monthly meetings.

OWNER occupiers continue to be hit by raising interest rates as more banks follow in the footsteps of the big four and jack up their costs to borrow.

And in a double whammy for Australians savers are also getting stung as interest rates go down on cash deposits.

Research from financial comparison website Finder.com.au shows Macquarie Bank is the latest bank to hike up owner occupier rates by increasing their standard variable rate from 5.5 to 5.7 per cent from November 20.

This will cost borrowers with an average $300,000 30-year home loan an additional $38 per month.

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It comes after Westpac and Commonwealth Bank kickstarted the out-of-cycle jump to interest rates earlier this month, before National Australia Bank and ANZ followed in their footsteps.

St George — owned by Westpac — will also increase their owner occupier rates from their standard variable rate of 5.54 per cent to 5.69 per cent from November 20, costing the average mortgage customer an additional $28 per month.

Finder.com.au spokeswoman Michelle Hutchison said some lenders were being sneaky about their upcoming interest rates hikes.

“Some have kept it quite which makes it difficult for Australians to keep track of the home loan market and which lenders are increasing their rates,’’ she said.

“It’s safe to assume that most lenders are likely to follow these banks’ lead and raise their rates as well.”

Banks have blamed the hikes on the need to raise extra capital ahead of the next financial year.

But borrowers aren’t the only ones to be slugged — savers are also being stung.

Citibank will drop its online saver account base rate by 0.2 percentage points on November 20 to 2.4 per cent.

Bankwest will also drop two of its savings accounts rates this week including the retirement account which will deliver customers a measly return of just 1.5 per cent (down from 1.75 per cent) on balances between $2000 and $48,000.

Mortgage Choice chief executive officer John Flavell said the Reserve Bank of Australia would be able to cut rates on Melbourne Cup day without heavily impacting the property market.

“It is easier for the RBA to make a cut now than it was previously because the majors have increased their rates and the impact that it would have on the property market wouldn’t be to the same extent,’’ he said.

Data from Finder’s Reserve Bank Survey which quizzed 30 leading experts and economists on interest rates found a majority (80 per cent) expected to the cash rate to stay on hold when the RBA board meets on Melbourne Cup Day next week.