Three quarters opting for variable rates: Mortgage Choice

Almost three quarters (74.13%) of those financing a loan are opting for variable rate products, up 0.62% over May, according to Mortgage Choice’s latest home loan approval figures.

Mortgage Choice spokesperson Jessica Darnbrough said that this is unsurprising as an increasing number of lenders are offering discounts on their variable rate products.

“Australia's lenders are hungry for business and they have been offering some sensational variable rate discounts in a bid to attract borrowers and grow their market share,” Darnbrough said.

“We have seen some lenders offering discounts of up to 1.3% and even 1.4% off the standard variable rate. We haven't seen this level of discounting for some time, so it is no surprise to see the popularity of variable rate products on the rise.”

Victoria and Queensland, however, have bucked the trend by being the only two states not recording an increase in demand and recording the lowest demand from the product – at 71.92% and 570.16% respectively.

New South Wales saw strong variable rate demand increases, with 7.25% growth over May to reach 73.65%.

Western Australia and South Australia recorded high popularity levels for variable rate products, at 80.15% and 78.24% respectively, and bringing up the national total.

“While variable rate demand was sluggish in both Victoria and Queensland, fixed rate demand was on the rise, with the popularity of this loan product surging 8% in Victoria to sit at 28.08% and 4.62% in Queensland to sit at 29.84%,” Darnbrough noted.

Fixed rate demand for the other states and territories was down nationally, at 25.87%, down from 33.06% recorded in December 2013.

If you're asking whether you should fix your rate, here's a recent analysis that may help.