One of the country’s biggest banks has hiked its fixed mortgage rates by a massive 1.1 per cent.
The move by NAB, comes just a day after Commonwealth Bank increased its fixed mortgage rates by 1.4 per cent, and only a few days before the next Reserve Bank board meeting.
Fixed mortgage rates for both owner-occupiers and investors will rise.
RateCity.com.au research director Sally Tindall RateCity.com.au, said NAB had “pulled the trigger on an extensive round of rate hikes”.
“While the hikes aren’t quite as large as CBA’s, many borrowers who were looking to fix with NAB are now likely to be reconsidering their options on the back of this news,” she said.
“CBA and NAB are not hiking in isolation. ANZ, Macquarie and HSBC have all made sizeable fixed rate hikes in the last fortnight and we expect others will follow. Westpac’s fixed rates are now well below the other big four banks’ rates, however, they’re unlikely to last long.”
One-year fixed rates with NAB will be 4.69 per cent under the changes, while five-year rates are now 6.29 per cent.
Meanwhile, the CBA has also cut its lowest variable home loan rate by 0.15 percentage points, down to 2.79 per cent, but only for new customers with a 30 per cent deposit.
The change comes as the RBA is set to meet on Tuesday to discuss whether to hike the cash rate for a third consecutive month.
In May, it raised the interest rate by 25 basis points to 0.35 per cent. A month later, the rate was bumped by 50 basis points to 0.85 per cent.
The cash rate hike will cost the average homeowner almost $2000 a year, according to research from Finder.
People with a home loan of $500,000 and 25 years remaining will see their repayments increase by $133 a month.
Those owing $1 million will see their mortgage repayments rise by $265 a month.
“The past few years have seen a huge number of buyers flood into the market, with rock-bottom interest rates. Those days are certainly over,” head of consumer research at Finder Graham Cooke said.
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