Home buyers save hundreds

04/12/2008

Australia's home buyers will save hundreds of dollars on their mortgages in the lead up to Christmas after the Reserve Bank cut interest rates to their lowest in seven years. And cuts are expected to continue into next year, with the futures market predicting that the official rate will be slashed to 2.75 per cent by May, its lowest level since the 1960's.

The Commonwealth and the National Australia banks passed the full cut yesterday, reducing their standard variable mortgage rate to 6.74 per cent. Mortgage holders with those banks will save close to $200 on the monthly cost of servicing a $300,000 loan. In all, they have saved a massive $570 a month since the Reserve started cutting rates in September.

Source: The Age, Peter Martin, December 3, 2008.